I have read several reports that 2010/11 will be a bad year for CRE. It’s seen 40% price declines already, and regional banks are going to get a clobbering. Some say CRE will look after itself, which is probably true to an extent, but that won’t diminish the scale, and knock on effects. For example, many renter are finding themselves out of a home. Investors are no doubt eagerly watching this one, and demanding higher cap rates, which may be tricky given higher vacancy rates, and downward pressure on rents. Overall I’m surprised at the low profile CRE crisis gets.
