WSJ Editorial: Is Commercial Real Estate Next?
SOURCE: The Wall Street Journal
Insights shared about the possible salvation of commercial mortgage markets if the Treasury plan works...
Today, debt on office buildings, shopping malls, hotels and apartment complexes continue to perform well. The default rate for commercial mortgage-backed securities (CMBS) loans stands at just 0.47%, while commercial mortgages in life insurance company portfolios have a default rate of just .03%.
Nevertheless, the $200 billion annual CMBS market is now dead in the water. Credit to the sector from other sources has almost completely stalled.
Through the turmoil and panic of the past few months, the American commercial real-estate market has delivered some sorely needed stability to the U.S. economy. But even this stability cannot be taken for granted in these unpredictable times.
The credit markets are now blocked by a fear that can be removed by the Treasury plan. And as the problem is solved, credit will be more available to Main Street homeowners, small businesses and consumers of every type. A deep recession can be avoided. Now is the time to act.
Read full story »
Insights shared about the possible salvation of commercial mortgage markets if the Treasury plan works...
Today, debt on office buildings, shopping malls, hotels and apartment complexes continue to perform well. The default rate for commercial mortgage-backed securities (CMBS) loans stands at just 0.47%, while commercial mortgages in life insurance company portfolios have a default rate of just .03%.
Nevertheless, the $200 billion annual CMBS market is now dead in the water. Credit to the sector from other sources has almost completely stalled.
Through the turmoil and panic of the past few months, the American commercial real-estate market has delivered some sorely needed stability to the U.S. economy. But even this stability cannot be taken for granted in these unpredictable times.
The credit markets are now blocked by a fear that can be removed by the Treasury plan. And as the problem is solved, credit will be more available to Main Street homeowners, small businesses and consumers of every type. A deep recession can be avoided. Now is the time to act.
Read full story »
