All GLG News Analyses Filed Under: Commercial Market Trends

Patrick YoungFounder and ChairmanDerivatives Vision

Eastern Europe: A Mecca for Retail Property Investment?

February 25, 2009

Analysis of:Central and Eastern Europe is target for cross border retailer movement | www.europe-re.com

The Central and Eastern European property market remains  unsophisticated compared to the west with ample opportunities for eager investors. However, current economic events provide both high risks and potentially high rewards...

Robert CanterPresident-FounderPerformance Realty Solutions, LLC

The Federal Reserve's Negative Outlook for Commercial Real Estate

February 24, 2009

Analysis of:Fed's Lockhart: Losing sleep on commercial property | www.reuters.com

The Federal Reserve has raised the Red Flag of caution on Commercial Real Estate. Unfortunately this flag had been raised over two years ago and no one paid attention. Just ask Susan Bies  former Fed Governor, she sounded the alarm in 2006.

Robert CanterPresident-FounderPerformance Realty Solutions, LLC

The Activity in the market will fall even further...this is just the beginning

February 23, 2009

Analysis of:Commercial Property Activity Falls to 12-Year Low | www.cnbc.com

What is important for everyone to keep and eye on is the unemployment figures. Unemployment is directly related to the overall vacancy rate, however the vacancy rate will lag a few months behind the unemployment numbers.

Robert CanterPresident-FounderPerformance Realty Solutions, LLC

A Little knowledge is a dangerous thing

February 9, 2009

Analysis of:Why Were So Many Commercial Real Estate Investors So Wrong? | www.gurufocus.com

The key implications are when so many arrogant whiz kids got into the capital markets and showed the deal makers how by using extraordinary amounts of debt, the system could create wealth beyond their wildest imagination. The old guard fell to their needs and bowed. Not that the old guard didn’t already know this, they just could not believe how fast and vast this wealth could be achieved and not by singular building by building purchases but by portfolio buying and the like. The same thing happened with the debt structures. No longer would mortgages be doled out one at a time, they would be mass marketed like government bonds, and they would be sold to unknown investors would took the word of the rating agencies who were tasked to “underwrite” vast amounts of debt with no real knowledge of the collateral involved. This was done in almost instantaneous time frames....and no one thought this was wrong?

Robert CanterPresident-FounderPerformance Realty Solutions, LLC

Too narrow a focus can skew your view.

February 9, 2009

Analysis of:Why Were So Many Commercial Real Estate Investors So Wrong? | economix.blogs.nytimes.com

The implication here is not so much this lonely economist’s view of the commercial real estate sector, it’s the fact that so many within industry keep saying how the commercial real estate market is not overbuilt therefore the results of this recession will not be as severe as the early 1990’s.

David GreenPrincipalTrinity Development Group

Someone Play A Dirge For Corus

February 5, 2009

Analysis of:Condo King Corus Weights Its Options | online.wsj.com

This article clearly demonstrates the dire straits Corus Bank is facing as it deals with a soaring number of problem loans and an REO department full of repossessed condos.  The facts presented in this article are more than enough to make most people doubt Corus' ability to continue as a going concern.  Three factors are pressuring the bank heavily: a loan portfolio comprised almost exclusively of condo construction loans of which more than 1/3 are now non-performing, Treasury’s rejection of the banks application for TARP funding, and the distinct possibility the bank will face heightened capital requirements.

Kenneth LeonardPrincipalLeonard Associates

Watch The Dominoes Fall

January 23, 2009

Analysis of:Reversals of Fortune | retailtrafficmag.com

In addition to the widely understood decline in commercial  real estate activity, this article details some of the lesser known ramifications this decline has had on the inexorably intertwined construction activities as well as the resulting impact on the finances of contractors, architects and the prices of construction materials. I thought it would be of interest to the GLG reader because of an example  used that illustrates a little known aspect of the shopping center industry in a recession.

Nonresidential Construction Downturn in 2009

January 22, 2009

Analysis by: GLG Expert Contributor

Analysis of:Nonresidential Construction Seen Falling 11% in 2009 | www.cnbc.com

The American Institute of Architects have hit the nail on the head with regard to declining commercial construction. Many sources of capital having dried up due to the banking fiasco and large down payments required by banks will certainly slow new construction in 2009.  A developer told me yesterday that his lender asked for thirty five (35) percent down on an approximate six (6) million dollar project even though he had commitments for sixty (60) percent of the project from Triple A rated tenants. Most developers faced with those paramaters will certainly slow and or stop new projects. Several areas of the U.S are faced with too much inventory of Type A high rise office and industrial warehouse space.  This will contribute to the downturn as well. The poor economy leaving most Americans will less money in their pockets will slow down new casino and hotel construction. Most general contractors should set their sights on large school, hospital and municipal projects in 2009.  

View of the Market

January 21, 2009

Analysis by: GLG Expert Contributor

Analysis of:View of the Commercial Real Estate Market | paramountcapitalcorp.com

See article.

Robert CanterPresident-FounderPerformance Realty Solutions, LLC

Surprise, Economists say the worst is yet to come...

January 20, 2009

Analysis of:ULI Panel: More Grim News | www.globest.com

The subject article has a quote that says... "No one in this process had the responsibility of making sure that the loans being made were good loans” Mark Zandi, Chief Economist, Moody’s Economy.Com This is an incredulous statement coming from a company (Moody’s) whose sole purpose was to be gatekeepers of all things securitized.

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