Blog on the Run: Reloaded

Thursday, July 23, 2009 8:35 pm

Second wave

Filed under: We're so screwed — Lex @ 8:35 pm

You know the growing problems in the commercial real-estate market — the ones I said earlier that no one seems to be talking about?

In my naivete and general ignorance of the subject of finance, I had hoped that the reason no one was talking about those growing problems was that they weren’t growing, and maybe that they weren’t even problems, even as the “for lease” signs proliferated in Greensboro storefronts.

Unfortunately, they’re talking about ’em now:

Two of America’s biggest banks, Morgan Stanley and Wells Fargo, on Wednesday threw into sharp relief the mounting woes of the US commercial property market when they reported large losses and surging bad loans.

The disappointing second-quarter results for two of the largest lenders and investors in office, retail and industrial property across the US confirmed investors’ fears that commercial real estate would be the next front in the financial crisis after the collapse of the housing market.

The failing health of the $6,700bn commercial property market, which accounts for more than 10 per cent of US gross domestic product, could be a significant hurdle on the road to recovery.

Ah, crud. I had really been hoping not to read a sentence anytime soon containing both “collapse” and “commercial real estate.”


1 Comment

  1. […] Realty, which owns a lot of commercial real estate … which, you may have heard, ain’t doing so […]

    Pingback by Not bad work if you can get it « Blog on the Run: Reloaded — Tuesday, September 29, 2009 9:39 am @ 9:39 am

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