CRE

From the Oregonian:
Portland’s commercial real estate market had largely dodged the residential market’s swoon.But the region’s continuing housing slide, the nationwide credit crisis and a slowing economy appear to be eating away at the office and retail real estate markets.“The economy has finally caught up with the office market,” said Patricia Raicht, vice president at […]

From the Columbian:
Vancouver-based Riverview Bancorp Inc. on Tuesday reported a 72 percent drop in its first-quarter net income because of expected losses from unpaid loans.In the three months ending June 30, the share of non-performing assets, or unpaid loans, on Riverview’s books grew more than tenfold from a year earlier, to $23.6 million, or 2.67 […]

Has the Commercial Real Estate slowdown hit Oregon?
From the Portland Business Journal:
Oregon’s retail and restaurant industry offers an odd combination: lots of closures but solid employment figures.According to the Oregon Employment Department, 199,300 Oregonians worked in retail in April, about 3,500 more than a year ago. The sector is growing at a rate of about […]

From the Bend Bulletin:
Central Oregon’s real estate market has cooled, but it won’t likely reach the depths of 1986, according to one longtime builder who says a diverse approach will steer his company through the slowdown.That’s when the city of Redmond issued only a handful of commercial and residential building permits throughout the entire year, […]

From the Bend Bulletin:
When Chemica Technologies, a Bend-based biotech research firm, pulled up stakes and moved to Portland last year, the managers at Grace Bio-Labs didn’t hesitate.Grace, a maker of patented labware for the molecular study of cells, was about to burst out of its space on Empire Avenue, Business Development Director Michelle Carney said. […]

As if the housing slump wasn’t enough of a blow to Bend now commercial real estate takes a hit.
From the Bend Bulletin:
REDMOND — A string of new buildings, some empty and others half-filled, line this city’s light-industrial corridor — a reflection of what happens when a slowing economy collides with too much speculative construction, according […]

Investment slumps correlate very well with recessions. The first graph shows the change in real GDP and Private Fixed Investment over the preceding four quarters, shaded areas are recessions. (Source: BEA Table 1.1.1) (note these are year-over-year changes, not quarter-by-quarter).
Click on graph for larger image.
Some observations:
1) Since 1948, private fixed investment has fallen during […]

From the WSJ: Office Vacancy Rate Rises For First Time in 4 Years. A few statistics from the article based on 79 metro markets:
The office vacancy rate rose to 12.6% from 12.5% in Q3.
Net absorption was slightly below 4.4 million square feet in Q4, compared to 16.2 million square feet in Q3.
19 million square feet […]

From the NY Times: Harry Macklowe’s $6.4 Billion Bill.
This is a story we’ve been following because it appears Macklowe bought at the top, and he has a large bill coming due next month for a highly leveraged transaction:
[Macklowe] has a $6.4 billion debt payment coming due next month in connection with his purchase of seven […]

From the Economist: Dominoes on the skyline
FROM up high, London is a picture of vigorous renewal. In just about every direction, construction cranes point contemplatively to the skies. They also point to the great boom that has taken place in commercial property in recent years. The collapse of that boom, which now threatens to slash […]