Commercial Real Estate Crashing

It's not just the housing market that's taken a dive. Things have started going south in commercial real estate, too. Here's an excellent post by a Globe Street blogger about the crash that is slowly going on in commercial real estate: Slow Motion Crash.

I source a lot of off-market commercial deals for select investors, and I certainly have seen an increasing difficulty in getting deals done this year on the commercial side. The blogger points out that many sellers are still in that unrealistic expectations stage, where they're still trying to get top dollar for their properties at a time when buyers (if they're actually buying) are expecting to pay less. I would add that I'm seeing a general reluctance of many buyers to close deals in the midst of credit problems, financial market problems and a lagging economy. In fact, one of the buyers I know told me several months ago that they were simply going to take the year off (at least until the 4th Quarter). And beyond just a couple of bloggers, Wachovia earlier this month issue a negative report on the state of commercial real estate. Finally, here in L.A. (and elsewhere) we've got some commercial real estate companies already encountering serious troubles, including Meruelo Maddux and Maguire Properties among others. Yes, the economic malaise has indeed spread to commercial real estate