Housing slump now going commercial
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commercial real estate, housing slump, real estate March 1st, 2008To insulate commercial real estate from a still-crumbling housing market, investors need a confidence boost and Congress should help give it, industry analysts and executives told lawmakers Thursday.
The fundamentals of the commercial real estate market — vacancy rates, net operating income and capital available for investment — remain strong. But the erosion of credit has hurt the market for apartment buildings, office towers and retail space as banks — faced with multibillion-dollar losses from bad bets on mortgage-backed bonds — lend less and have tightened the terms of the loans they do provide.
“Nobody has trust in the banking system,” said Jeffrey Schwartz, chairman and chief executive of industrial real estate investment trust ProLogis told the Senate Finance Committee. “There’s no trust in (commercial mortgage-backed securities) markets.”
Tags: commercial real estate, housing slump, real estate
