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October 2007
Recent events raise the question: are commercial real property markets at a turning point? The events concerned include spillovers from sub-prime lending problems in housing. The near collapse of two residential sub-prime lenders rescued by loans from owner Bear Stearns, plus bankruptcies of other sub-prime lenders, have apparently caused several big debt issues to be cancelled or reduced in size because of investors' negative reactions. Even mighty Blackstone's stock price fell below its IPO level! Is this a sea-change in the easy availability of low-yield debt that has fueled the immense run-up in commercial property prices since 2000?
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