Commercial real estate gets in on rescue plan
International Herald Tribune reports: The commercial property industry applauded the US government's move to include commercial mortgages in a key lending program Tuesday, but experts said the plan's lack of details is disconcerting.
US Treasury Secretary Timothy Geithner said the government's Term Asset-Backed Securities Loan Facility will include securities backed by commercial property loans.
The program, being developed by the Federal Reserve, allows investors to swap AAA-rated securities for US Treasuries, which could then be used as collateral for new financing. The goal is to create new lending in a now frozen market.
The news comes not a moment too soon for the troubled commercial property industry, which is facing a torrent of debt coming due this year at the same time that property prices, rents and occupancies are falling.
"No one is calling for a bailout for high-flying guys who overpaid at the top of market, but there are many healthy owners with performing assets who can't access the debt markets right now," said Dan Fasulo, managing director of research firm Real Capital Analytics.
View the full article on International Herald Tribune: Commercial real estate gets in on rescue plan
Posted by: Matthew Stone