Fortunately for President Obama, he didn't have to deliver the State of Commercial Real Estate Address last night...
Because if he did, there is no amount of spin that he could have used to put a good face on the reality of the situation: commercial real estate is a disaster in the making.
In fact, that point was only underscored earlier this week when the owners of the Stuyvesant Town apartment complex announced they would default on the $4.4 billion in loans they used to buy the property at the peak of the commercial bubble.
Now, some four years later, that deal has soured just like the rest of them, as falling rents and plummeting real estate values have turned their big purchase into a no-win situation for everyone involved That left Tishman Spenser and Blackrock with their only option: handing the keys back to the lender after missing a $16.1 million interest payment and watching the value of their property fall 65% from the peak. Left with a property now worth only $1.9 billion, they simply threw in the towel in one of the most expensive cases of jingle mail on record. MORE
