NEW YORK: Vacancy rates in office buildings exceed 10 percent in virtually every major city across the United States and are rising rapidly, a sign of economic distress that could lead to yet another wave of problems for the beleaguered financial sector. With job cuts rampant and businesses retrenching, more empty space is expected from New York to Chicago to Los Angeles in the coming year. Rental income would then decline and property values would slide further. The Urban Land Institute predicts 2009 will be the worst year for the U.S. commercial real estate market “since the wrenching 1991-1992 industry depression.”
Stock analysts say commercial real estate is the next ticking time bomb for banks, which have already received hundreds of billions of dollars in capital and other assistance from the U.S. government. Big banks – like Bank of America, JPMorgan Chase and Morgan Stanley – each hold tens of billions of dollars in commercial real estate bonds, which were sliced and diced into securities. The banks also invested directly in properties. Jeffrey DeBoer, chief executive of the Real Estate Roundtable, a lobbying group in Washington, is asking for government assistance for his industry and warns of the potential impact of defaults. “Each one by itself is not significant,” he said, “but the cumulative effect will put tremendous stress on the financial sector.”
Anyone notice the strip malls starting to resemble ghost towns?
Yeah, strip malls all around are emptying out. Here in Vegas, it seems that there are at least 2-3 vacancies per strip mall, and if the large store that brings in most of the customers closes, then the rest of the mall folds. There are at least 3 within 3 miles of here that a year ago were vibrant and full and now are looking like a scene from The Good, The Bad, & The Ugly.
It is getting kind of Grapes of Wrathy out there.
go long SRS
um..duh…its all ready been said the next wave of defaults will be bigger than the last..
ALT-A and ARM mortgage resets coupled with
mass store closings leaving landlords with
no one to pay the rents will be bigger
than the recent sub-prime scam..
2008 was the warm-up..2009-10 will be pure
hell…my bets start the next wave around feb-april.. with maybe a little selloff starting
this friday just for sh*ts & giggles..
-*turn off your TV’s* and stop listening to the
payed MSM stooges and learn to read the data yourself..
on top of that…as soon as the warehouses run dry, were going to have shortages the land of excess hasn’t seen in ages.. stock up on all your spare parts/food and whatever else..
prices will soar soon..
learn the Baltic Dry Index (BDI) its the only index that cant be manipulated to hell..its still flat…
for a quick clue..listen/study this chart..
http://investorshub.advfn.com/boards/playvideo.aspx?v_id=254
-just how long do you think can keep suppressing the gold price to keep the dollar propped up?
-s
YEA,
Property taxes MIGHT DUMP ALSO???
YES, YES, YES…
Starting companies and the little guy, MIGHT get a chance..
Strip malls make good new urban neighborhoods, for working families. They’re close to freeways, have good parking and open spaces. And dwellings mixed with retailers improve the security and the financial stability of the communities. A mall is a city of shops, without houses – that never made any sense.
After the commercial property shoe hits the ground there will be at least one more bump: credit cards go boom.
Nightline just did a show on the market for highend realestate==the $50Million White Elephants. The good news was that high end properties get hit near the bottom of a down market.
Somehow I don’t think that is true this time. With oil prices down (Dubai properties in huge slump causing building halt) and the market “disappearing for recyclables” (waste goods selling last year at $160 per ton now at $20 or zero) I think the White Elephant slump may actually indicate how deep and persistent this depression will be.===see #4 for the reason–and has anyone heard just what the Big Three Auto have agreed to do that will make them competitive in the world market??? Me neither. So jobs will continue to disappear==the real engine of a healthy society.
#5: wanna bet? I just got my property tax statement from my city. The assessor must be living in a dream world: not only did the 2009 tax rate per thousand go up 2.5%, but so did my home valuation! I called up the assessor and asked why my house value went up when real estate prices are plummeting everywhere. He said that property values aren’t pegged to actual real estate values or trends, but formulas and assessors’ opinions of what the value should be for tax purposes only!
No break for some of us this year!
Here in the Land of Benderson strip malls are still being built with tax incentives and hotels are being built with tax incentives, all while every credible forecast of demand for either points to the insanity of adding more supply to a crashing market. But here the politicians tremble at the thought of a lawsuit for denying expansion and their God-given right to build whatever the f they want regardless of what green space they displace or what infrastructure is demanded. Insanity has been defined as repeating the same action while expecting a different outcome. Stop by if you’d like to see examples.
#9, He said that property values aren’t pegged to actual real estate values or trends, but formulas and assessors’ opinions of what the value should be for tax purposes only!
He’s full of it.
If you can get an independent survey of the recent home sales prices in your area, you can fight it and win. I did it, shortly after the state “re-assessed” all home prices in my state at an average of +15% about 6 years ago (right after the .com bust).
Asking the government to assess your property accurately when they are ones who stand to win or lose is a “fox and hen house” arrangement.