Commercial Real Estate Finance

Posts Tagged ‘distressed assets’

I think that the flood of distressed property has never materialized because of what is commonly described as extend and pretend. If the economy continues the slow up tick, and real estate owners can continue to make loan payments, it is unlikely that distressed assets will hit the market in droves.

However, Robert Griffin, president of the New England region for Cushman & Wakefield expects that “you’ll see a lot of distressed properties coming on the market in mid to late 2010’’

I think that Robert Griffin, who makes his living from real estate transactions, might be a bit biased in his predictions.

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The Week of January 16-22

- Are the credit markets reaching their peak?

- Good news for U.S. CRE?  European transactions have increased by 42%.

- Europe’s largest insurance company, Allianz, is increased CRE investment allocations.

- Earlier this week, Capmark Investments, a subsidiary of Capmark Financial, filed for bankruptcy.

- Has London surpassed Washington D.C. as the world’s favorite CRE market?
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The Week of October 24-30

- Capmark finally filed for Chapter 11 bankruptcy protection, but will prevail in the end.

- How many more firms could be following Capmark into bankruptcy?

- Could PPIP be the solution to more bank transparency with regard to distressed assets?

- The Great Recession may be ending, but for CRE, its more like the Great Depression beginning.

- ING will be spinning off to get ahead.
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Landlords are scrambling to find tenants and buyers at a reasonable price. Buyers are scrambling to pool funds together to buy distressed assets. Over the last 6 months or so, we here at Llenrock have been approached by a variety of would be investors seeking equity to start, in some form or fashion, a distressed asset fund.  The simple logic is that with asset values plummeting, there will be opportunity.  There HAS to be opportunity.  Its the basic “sell high, buy low” mentailty of Wall Street. We hear pitches like, “I have an opportunity to buy a Class A building in a good submarket for only $100 per square foot!  It’s a steal!  It’s a no-brainer that its a good buy!”

Well, it may be a no-brainer…not because its a good buy, but because the people aren’t using their brains to properly assess the market. Read the rest of this entry »

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