Vacancies in office space

[34f3f3f]

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.

[briansd1]

[quote=qwerty007]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.[/quote]

I agree. CRE crash/recession will be long and protracted.

Local/regional banks will go under. They won’t be bailed out like Citigroup but they’ll be quietly taken over by the FDIC, creating a repeat of the S&L crisis of the 90s.

Of course CRE doesn’t have the emotional appeal of housing. In CRE, the press can’t get good stories about pregnant single moms getting evicted.

[briansd1]

[quote=qwerty007]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.[/quote]

I agree. CRE crash/recession will be long and protracted.

Local/regional banks will go under. They won’t be bailed out like Citigroup but they’ll be quietly taken over by the FDIC, creating a repeat of the S&L crisis of the 90s.

Of course CRE doesn’t have the emotional appeal of housing. In CRE, the press can’t get good stories about pregnant single moms getting evicted.

[briansd1]

[quote=qwerty007]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.[/quote]

I agree. CRE crash/recession will be long and protracted.

Local/regional banks will go under. They won’t be bailed out like Citigroup but they’ll be quietly taken over by the FDIC, creating a repeat of the S&L crisis of the 90s.

Of course CRE doesn’t have the emotional appeal of housing. In CRE, the press can’t get good stories about pregnant single moms getting evicted.

[briansd1]

[quote=qwerty007]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.[/quote]

I agree. CRE crash/recession will be long and protracted.

Local/regional banks will go under. They won’t be bailed out like Citigroup but they’ll be quietly taken over by the FDIC, creating a repeat of the S&L crisis of the 90s.

Of course CRE doesn’t have the emotional appeal of housing. In CRE, the press can’t get good stories about pregnant single moms getting evicted.

[briansd1]

[quote=qwerty007]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.[/quote]

I agree. CRE crash/recession will be long and protracted.

Local/regional banks will go under. They won’t be bailed out like Citigroup but they’ll be quietly taken over by the FDIC, creating a repeat of the S&L crisis of the 90s.

Of course CRE doesn’t have the emotional appeal of housing. In CRE, the press can’t get good stories about pregnant single moms getting evicted.

[EconProf]

CRE is much more prone to violent swings than residential properties. Supply and demand factors impact quickly the market prices and rents, unlike the slower moving housing and apt. markets, making prices less “sticky”.
Of late there have actually been some signs of a bottoming in CRE. Some indicators of price are actually up in recent markets. Stocks of CRE-related companies are up. REIT stocks are especially strong over the last year. Bottom-fishers are prowling and finding credit available since prices have fallen so drastically.

[EconProf]

CRE is much more prone to violent swings than residential properties. Supply and demand factors impact quickly the market prices and rents, unlike the slower moving housing and apt. markets, making prices less “sticky”.
Of late there have actually been some signs of a bottoming in CRE. Some indicators of price are actually up in recent markets. Stocks of CRE-related companies are up. REIT stocks are especially strong over the last year. Bottom-fishers are prowling and finding credit available since prices have fallen so drastically.

[EconProf]

CRE is much more prone to violent swings than residential properties. Supply and demand factors impact quickly the market prices and rents, unlike the slower moving housing and apt. markets, making prices less “sticky”.
Of late there have actually been some signs of a bottoming in CRE. Some indicators of price are actually up in recent markets. Stocks of CRE-related companies are up. REIT stocks are especially strong over the last year. Bottom-fishers are prowling and finding credit available since prices have fallen so drastically.

[EconProf]

CRE is much more prone to violent swings than residential properties. Supply and demand factors impact quickly the market prices and rents, unlike the slower moving housing and apt. markets, making prices less “sticky”.
Of late there have actually been some signs of a bottoming in CRE. Some indicators of price are actually up in recent markets. Stocks of CRE-related companies are up. REIT stocks are especially strong over the last year. Bottom-fishers are prowling and finding credit available since prices have fallen so drastically.

[EconProf]

CRE is much more prone to violent swings than residential properties. Supply and demand factors impact quickly the market prices and rents, unlike the slower moving housing and apt. markets, making prices less “sticky”.
Of late there have actually been some signs of a bottoming in CRE. Some indicators of price are actually up in recent markets. Stocks of CRE-related companies are up. REIT stocks are especially strong over the last year. Bottom-fishers are prowling and finding credit available since prices have fallen so drastically.

[sdduuuude]

In the residential market, the gov. bailed out the banks by pretending to “help homeowners stay in their homes.” That’s gonna be a tough sell when it comes time to “help keep commercial real-estate owners in their commercial real estate.”

As such, this could be pretty hard on the banks cuz the gov will have a much harder time bailing them out, politically speaking.

Also gonna be tough for the owners to claim “predatory lending” when they are business people.

At this point, I hate to say I’d be surprised at anything the gov does, but, it seems a tougher challenge to bail out the banks on CRE.

[sdduuuude]

In the residential market, the gov. bailed out the banks by pretending to “help homeowners stay in their homes.” That’s gonna be a tough sell when it comes time to “help keep commercial real-estate owners in their commercial real estate.”

As such, this could be pretty hard on the banks cuz the gov will have a much harder time bailing them out, politically speaking.

Also gonna be tough for the owners to claim “predatory lending” when they are business people.

At this point, I hate to say I’d be surprised at anything the gov does, but, it seems a tougher challenge to bail out the banks on CRE.

[sdduuuude]

In the residential market, the gov. bailed out the banks by pretending to “help homeowners stay in their homes.” That’s gonna be a tough sell when it comes time to “help keep commercial real-estate owners in their commercial real estate.”

As such, this could be pretty hard on the banks cuz the gov will have a much harder time bailing them out, politically speaking.

Also gonna be tough for the owners to claim “predatory lending” when they are business people.

At this point, I hate to say I’d be surprised at anything the gov does, but, it seems a tougher challenge to bail out the banks on CRE.

[sdduuuude]

In the residential market, the gov. bailed out the banks by pretending to “help homeowners stay in their homes.” That’s gonna be a tough sell when it comes time to “help keep commercial real-estate owners in their commercial real estate.”

As such, this could be pretty hard on the banks cuz the gov will have a much harder time bailing them out, politically speaking.

Also gonna be tough for the owners to claim “predatory lending” when they are business people.

At this point, I hate to say I’d be surprised at anything the gov does, but, it seems a tougher challenge to bail out the banks on CRE.

[Author]

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