(Source: The Globe and Mail)
A looming crisis in commercial real estate looks like the next big headache for recession-weary Americans. Real estate insiders, experts and regulators warned a U.S. congressional committee Thursday that commercial real estate is headed for a crash that could eclipse even the devastating slump of the early 1990s, saddling already hobbled banks with a new wave of bad loans.
The picture isn’t pretty. Property values have already collapsed more than home prices, vacancy rates are soaring as the recession wears on and once-buoyant loan and credit markets have virtually dried up. Now, even the owners of good properties are facing foreclosure. “Commercial real estate is the next shoe to drop,” James Helsel, a Pennsylvania realtor and treasurer of the U.S. National Association of Realtors, told the joint economic committee.
Read the full article by Barrie McKenna “U.S. commercial real estate the next big risk” in the Globe and Mail (July 10, 2009).