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Tyler, Thanks for the blog. I am in the sunny SW and operate one of the largest commercial brokerage companies in the metro. Thought I would give a little ground level on what I am hearing and experiencing here. Brokerage fees are off by 75% compared to 07. All of our competitors in the same boat, including CBRE. Everyone is waiting for the tsunami to hit. We have a newly constructed property that we are into over 160MM; can't get a new loan for more than 70MM. And we are over 90% leased! Just reduced asking rates by over 40% to fill the balance. Tenants in other projects are requesting and getting rent relief. Again, this isn't just us it is across the board.And for his exponentially growing fans, the latest from wallstreetpro - please don't mind the mild commercialism - the toxic Chinese gas, the vacuum cleaner, and the batman curve ball more than make up for it (thanks Dave).
Apartments are the first prop. type that is going to go through the price reset, retail and office to follow. Nearly 25% of apartment properties are in severe distress. The most recent REO trades are selling at less than 50% of 07 peak prices. And they have debt available through Fannie!
Overall price declines of 30 to 40% are expected. Those property owners that have a lot of newly constructed product are getting hit the worst. Rents off 30%, cost of debt way up. CRE is going to be a disaster.
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