Commercial real estate–the other shoe is still dropping:
It’s just a hint of the harrowing state of affairs in commercial real estate, where vacancies are on the rise across virtually all sectors, rents and property values are dropping, building owners are low on funds, and financing options are drying up.
And bad as things are, they’re expected to get worse – the next slide in the snowballing economic crisis that began with the collapse of the housing market and continues to claim casualties.
For instance, a property bought in 2005 for $10 million with a $7 million mortgage now might be valued at $6 million, said Steve Blank, a senior fellow in finance at the Washington-based Urban Land Institute.
Since these folks are losing their Armani shirts for whole shopping centers and office buildings, rather than for one bungalow or condo, there will be no shortage of state and local government help for them and no pundits calling them deadbeats for taking out the loans in the first place.
No, they are merely victims of the economy. It is only the poor who are responsible for their own fates.
December 6, 2009 at 12:33 pm
Somehow or another, I got on a list that notifications of commercial pieces of real estate coming up for, or already are, on sale. (And thanks to the glitch in my stupid computer, I can’t hit the “unsubscribe” link! There are restrictions on my computer I’m not authorized to remove & I own the damn thing!!!)
While to an individual the prices seem high, maybe for a corprate entity looking for a place to buy, they may not be. But there are a bunch of them.