FusterClucked Again: The Commercial Real Estate Crash Is On

From ExiledOnline:

News about the economy has gone from apocalyptic to merely bad. Stock indexes and commodity prices have been on a five month tear. Hints are showing up that at least the worst of the home mortgage disaster might be over. Unemployment is still at scary levels, but at least the rate of its increase is slowing.

All in all, it would seem that maybe the Fed printing a stack of dollars one trillion high and throwing it at the banks might actually be working, if by “working” one means a long-term debasing of the currency to get a short-term boost in the economy, though I doubt B. Bernanke would explain it in precisely those terms. However, there is another major jolt on the way for credit markets, banks, and, by extension, the rest of the economy: commercial real estate.

It’s not too tough to find out that there is something amiss with commercial real estate. A quick walk around Manhattan does the trick, seeing the amount of prime first floor retail space currently seeking offers. The same is true when reserving a room in a hotel more expensive than a Super 8. I was in Boston for work a month ago and stayed in the hotel I usually use and the room that cost me (or rather, my employer) $375 two years ago was going for $149 and the parent company of the hotel was offering a “stay 3 days get one free” deal. However, the anecdotal evidence is nothing like a chart of hard numbers. Here’s one:

Read the rest:

http://exiledonline.com/fusterclucked-again-the-commercial-real-estate-crash-is-on/

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