Commercial property defaults are a sign that businesses are
closing up. For each 100 sf of commercial property you are looking at 2-3 jobs gone.
When is the focus going to be Jobs????
Commercial property will only come back when jobs come back.
Auto industry will only come back when jobs come back.
Housing will only come back when jobs come back.
Banking/Finance will only come back when jobs come back.
Mr. Obama where are the jobs you promised?
Those would be government jobs. You know, like census takers.
No, the comming commercial real estate defaults are coming for the same reasons that the residential bust happened, too much hyperspeculation and run ups in values, everyone wanted in, got easy money to do it, overbuilt, didn’t matter who occupied the property just having the proprty itself was the action that made you rich... Well, Bust has happened, property values plummet, fewer buyers and tenants, overbuilt, overvalued and now unlike a persons home, no incentive to even TRY to hold onto a piece of commercial property. Let the bank have it.
Commercial real estate was overbuilt, overvalued, bubbled just as much if not more than residential and will suffer the same results. Jobs not only have to come back, but the economy has to grow at least another 10-20% from its peak to fill all the space, because everyone was building based on 20% growth projections.