David Fessler, regular contributor to Investment U, shares his current analysis of the Commercial Real Estate market – and why now might be the time to jump right in!

David Fessler (Investment U):

Back in April, I wrote a column detailing the looming train wreck in the commercial real estate market.

It turned out to be a rather controversial piece.

How controversial? You can judge for yourself here in my April column: The Commercial Real Estate Sector: As The Other Shoe Drops – Be Wary of Bank Stocks. It was groundbreaking enough to land me a spot on Glenn Beck’s show on Fox News.

Virtually nobody else was talking about the topic and a number of readers e-mailed to tell me how daft I was for even mentioning it. But I sensed the mess coming a mile away.

Right now, commercial real estate is in the gutter. It’s where the banks were last March. No one wants to touch the sector in any form.

But I think it’s time to jump back in.

And before you think I’ve sucked down a little too much holiday eggnog, hear me out…

A Contrarian Bet Worth $9.5 Billion

I’m in good company with my projection here.

During last February and March, a hedge fund called Appaloosa Management was busy buying up shares of Bank of America (NYSE: BAC) and Citigroup (NYSE: C).

And the guy calling the shots was a man named David Tepper, who runs the fund.

At the time, investors, colleagues and even his friends thought he was nuts – a move akin to lounging on the deck of the Titanic while everyone else was abandons  ship.

But in yet another example of how it’s often wise to take a contrarian investment stance, the bet not only paid off handsomely for Tepper’s firm, but for Tepper personally. Appaloosa is up nearly $7 billion on the trade, while Tepper stands to pocket a very cool $2.5 billion in profit for himself.

Tepper’s no one-hit wonder either…

His track record includes huge payouts for his investors in Korean stocks, Russian debt, junk bonds and commodities over the last decade.

We should all be so astute…

Perhaps we can be, because there’s still time to get in on his next big idea…

A Lonely Voice in a Sea of Pessimism

Tepper is quietly purchasing commercial mortgage-backed securities (CMBS).

His purchases include large chunks of real-estate debt – mostly in the form of bonds, according to the Wall Street Journal.

Most notable among them are huge portions of the debt of two New York City developments – Peter Cooper Village and 666 Fifth Avenue, both high-profile real estate development deals. Tepper believes both are significantly undervalued. . .

Click here for the rest of Mr. Fessler’s article on Investment U.