Commercial Real Estate: How deep is the rabbit-hole?
Print This Story
November 23rd, 2009 by Prieur du Plessis, Investment Postcards from Cape Town
Twitter It! | Email This Article
D.C.-area developer Jeff Neal gives the Huffington Post Investigative Fund a tour of empty commercial properties just blocks from the Capitol. Hundreds of small and medium-sized banks are facing huge numbers of possible defaults by builders who erected thousands of office towers, condominiums and shopping centers with the easy credit available five years ago.
“Commercial real estate loans generally have terms of five to seven years. Many of the loans issued at the height of the credit bubble are coming due. By mid-November, $150 billion worth of commercial properties, about 7,500 in total, were in distress, according to Real Capital Analytics Research,” reported The Huffington Post. More than 400 banks are on a problem list maintained by the Federal Deposit Insurance Corp, largely as a result of commercial debt.
Referring to the malaise of commercial real estate, Michael Stevens, senior vice president for regulatory policy at the Conference of State Bank Supervisors, said: “It’s not the next big thing. It is the big thing. We’re dealing with it right now. We wouldn’t be at 120 bank failures if we weren’t seeing it now.”
Click here for the full article.
Source: YouTube and The Huffington Post, November 20, 2009.
Dr. Prieur du Plessis is an investment professional with 26 years' experience in investment research and portfolio management. More than 1,200 of his articles on investment-related topics have been published in various regular newspaper, journal and Internet columns, including his blog, Investment Postcards from Cape Town. He has also published a book, Financial Basics: Investment. Prieur is Chairman and principal shareholder of South African-based Plexus Asset Management, which he founded in 1995. The group conducts investment management, investment consulting, private equity and real estate activities in South Africa and a number of foreign countries. He also serves as Honorary Consul of Slovenia for South Africa, actively developing economic, cultural and scientific relations between Slovenia and South Africa. Prieur is 54 years old and live with his wife, television producer and presenter Isabel Verwey, and two children in Cape Town, South Africa. His leisure activities include long-distance running, traveling, reading, motor-cycling and scripophily. Read more from the author/contributor here.
Related Posts
Zweig: Investors Faith in Returns a “Fairy Tale”
Marc Faber: Gloom, Doom & Chances of a Boom
Bill Gross: Staying rich in the “new normal”
Tags: Article Source, Balanced Budget, Bill Gross, Bond Investors, Central Banks, Co Founder, Dollar Weakness, Downside, Financial Markets, Future World, Gdp Growth Rates, Global Economic Growth, Gross Co, Investment Outlook, Maturities, Money Men, PIMCO, Target, Will Rogers, Yield CurvesPosted in Markets |
