RCA in the commercial property press:

Double The Trouble: Level Of Distressed Local Property Jumps

Crain's Chicago Business reports: The volume of troubled commercial real estate in the Chicago area has nearly doubled over the past five months, to $7.5 billion, fueled by the mushrooming turmoil in the office sector, a new report says.

The dollar value of local distressed real estate has shot up more than 70% since Oct. 1, when the total was about $4.4 billion, according to Real Capital Analytics Inc. Office properties now account for nearly half of the local woes, up from just 11% five months ago.
As startling as the rise in the Chicago area may be, the national picture is even worse.

The volume of distressed property nationwide expanded by 149% since October, to nearly $140 billion.

The report uses a broad definition of distress, including properties with loans that are delinquent, in default, modified, near maturity or facing foreclosure. Real Capital also includes properties where the tenant or the owner is bankrupt or under financial pressure.

But the rate at which properties are falling into distress has slowed in the past couple months.

Moreover, “as lenders gain both perspective on their holdings and guidance from federal regulators on handling workouts, the pace of restructurings and especially resolutions has picked up markedly,” the New York-based real estate research firm says in its “Troubled Assets Radar report” issued March 8.

Articles related to this topic:

 Commercial Lenders Delaying Liquidation
 Optimism Growing in Commercial Real Estate
 A Plan to Save Commerical Real Estate
 PE Firm Starwood Raises $2.8 Bil. for Distressed Real Estate
 Over $187 billion in Distressed Property Nationally

Posted by: Mark Alferman

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