Commercial real estate crunched
The global credit crunch that has rattled financial markets over the past few weeks is finally reaching the vast commercial real estate investment and development industry in the United States.
Predictions by some analysts that prices for office buildings and other commercial properties are poised to drop are sending shivers through the business, driving down real estate company share prices and delaying some deals.
“We are seeing fewer people at the table, but when it comes to the best buildings there are still plenty of people who want to buy them,” John Cushman, the chairman of the real estate brokerage Cushman & Wakefield, said.
But bidders that had been borrowing heavily to leverage property acquisitions were falling away as lenders shut out marginal players, Mr Cushman said. However, so far the long-robust market had cooled but not collapsed.