Skip to: Content
Skip to: Site Navigation
Skip to: Search
TUESDAY, NOVEMBER 24, 2009
| Subscribe to Newser's RSS feeds RSS | Follow Newser on Twitter Twitter


1

Commercial Real Estate Crisis May Rival '90s Disaster

Share

(Newser) – Commercial real-estate borrowers are defaulting on their loans at an ever-faster pace, and experts now believe the crisis could match or exceed the early-1990s slump, the Wall Street Journal reports. That catastrophe killed off 1,000 banks and savings institutions, with lenders taking $48.5 billion in charges. This time, one firm estimates, as much as $250 billion could be lost, resulting in more than 700 bank failures.

Since September, the delinquency rate on about $700 billion in securitized commercial loans has more than doubled, to 1.8%. That’s a bit shy of the ‘90s rate—though not bad compared to home delinquencies. “In just seven months, we've gone from the best of times to the worst of times,” said Deutsche Bank’s head of commercial mortgage securities.

In this Nov. 17, 2005 file photo, sunlight reflects off the John Hancock Tower onto a statue outside the Boston Public Library. The tower is being sold in a foreclosure auction.
In this Nov. 17, 2005 file photo, sunlight reflects off the John Hancock Tower onto a statue outside the Boston Public Library. The tower is being sold in a foreclosure auction.   (AP Photo/Michael Dwyer, file)
Shoppers stroll near the entrance to the Macy's department store at the Mall at Millennia in Orlando, Fla., Tuesday, Feb. 24, 2009.
Shoppers stroll near the entrance to the Macy's department store at the Mall at Millennia in Orlando, Fla., Tuesday, Feb. 24, 2009.   (AP Photo/John Raoux)
Building materials are lifted by crane to the roof of a building under construction on New York's Fifth Ave. Monday, Feb. 9, 2009.
Building materials are lifted by crane to the roof of a building under construction on New York's Fifth Ave. Monday, Feb. 9, 2009.   (AP Photo/Mark Lennihan)
« Prev« Prev | Next »Next » Slideshow
OFF THE GRID
11.23.09
Books Are Bad for You
11.20.09
The Health-Care Wars Have Just Begun
1 comment
VIEWING:
 
radnip
Mar 27, 09 5:25 AM CDT
Cool. So now we know capitalism can't work without government bailouts. Neato. Reply
Vote up! Vote down!
0
LEAVE A
COMMENT Comment Policy
Facebook ConnectPost this comment to Facebook?

After connecting you will have the option to post your comment on your Facebook profile.

 

Related Newser Stories

269 Stories

 Buffett: 
 'Financial 
 Panic Is 
 Behind Us' 

He sounds optimistic note at Columbia University forum

Nov 12, 09 9:14 PM CST
(Newser) - Warren Buffett says the worst is over. "The financial panic is behind us," he declared at Columbia University. The Berkshire Hathaway chief acknowledged that the US economy "still is sputtering some," but he sounded a bullish note on investment opportunities around the globe. While he gave... More »

MORE ABOUT:
Warren Buffett • recession • Berkshire Hathaway • panic • financial crisis

9 Other States Have Calif.-Sized Fiscal Messes

Ariz., Fla., Ill., Mich., and NJ among others facing crises

Nov 11, 09 8:14 PM CST
(Newser) - California has by no means cornered the market on enormous financial problems at the state level, with a report out today saying Arizona, Florida, Illinois, Michigan, Nevada, New Jersey, Oregon, Rhode Island, and Wisconsin are also at tremendous risk. The Pew Center sees widespread unemployment, huge budget deficits, and the... More »

MORE ABOUT:
Florida • California • Wisconsin • Arizona • New Jersey • Michigan • foreclosure • recession • Oregon • unemployment • Illinois • Nevada • Rhode Island • budget deficit • financial crisis

Half of US Kids Will Get Food Stamps at Some Point

Figure hits 90% for black children, study finds

Nov 2, 09 9:29 PM CST
(AP) - Nearly half of all US children and 90% of black youngsters will be on food stamps at some point during childhood, and fallout from the current recession could push those numbers even higher, researchers say. The estimate comes from an analysis of 30 years of national data, and bolsters other... More »

MORE ABOUT:
African Americans • children • recession • poverty • children's health care • food stamps • financial crisis • women's issues

269 Stories


Citigroup thinks things will be fine
Business Insider

Defaulting commercial properties hit banks
Bloomberg

The new rules for commercial real estate investing
NuWire


Business 
TwitterFollow @NewserBusiness on Twitter

 
bankruptcy • recession • mortgage backed securities • commercial real estate • mortgage delinquency • financial crisis

from our news partners