Get ready for the dreaded double-dip. $3 trillion in commercial real estate is about to go [poof]:
Why do you think banks have stopped lending in this arena? The market is completely saturated with vacant real estate. Commercial real estate either has a market or sits empty. At least with residential real estate if you drop prices low enough you will get buyers. With CRE if you built a complex with no foot traffic you can’t give the stuff away. The loan is only one aspect of costs. You have utilities and other fixed overhead. The fact that banks have pulled back from this market tells us no good deals are coming to the table.How's that sprawl working out for you? I've always loved the idea of business park. Not loved as in liked, but loved as in amused that people thought they might work.
Saturday, May 29, 2010
at 7:06 PM