CRE

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 […]

From Jon Lansner at the O.C. Register: Vacancies up, rates flat for O.C. offices
The county’s vacancy rate ended 2007 at 12.43%, up from 10.53% in Q3 2007 and 7.91% a year earlier. …However, the vacancy rate doesn’t include sublease space — when a company has more room than it needs and is trying to find […]

From Bloomberg: Centro Puts Itself Up for Sale as Debt Deadline Looms
Centro Properties Group, facing a Feb. 15 deadline to refinance A$3.9 billion ($3.4 billion) of debt, will consider offers for all its assets including 700 U.S. malls. …Centro’s largest U.S. shopping centers are Independent Mall in North Carolina and Cortlandt Towne Center in New […]

From the WSJ: Credit Downturn Hits the Malls (hat tip Houston)
The credit crunch … is creating problems in commercial real estate, driving down prices of office buildings, shopping malls and apartment complexes …
For the past few months, the sector has been in a state of near-paralysis … The number of major properties sold is down […]

From Bloomberg (no link yet): Macklowe Failed to Repay $500 Million Loan, Newsletter Says (hat tip Brian)
New York investor Harry Macklowe failed to pay a $495 million loan from Deutsche Bank AG to develop an office, hotel and condominium tower on the Park Avenue site of a former luxury hotel, Commercial Mortgage Alert said.…He also […]

From the WSJ: National City Warns of Loan Losses
National City Corp. expects to set aside about $700 million to cover loan losses in the fourth quarter and said it incurred mortgage-related charges of about $200 million in October and November.
“The mortgage business continues to be under stress,” the financial-services company said in a Securities and […]

Centro Properties Group, the owner of 700 U.S. shopping malls … says it’s struggling to refinance debt. Melbourne-based Centro suspended dividends and said in a statement that it may have to sell assets, after lenders set a Feb. 15 deadline to negotiate maturing debt. Traditional sources of funding are “shut for business,” Chairman Brian Healey […]

From the Chicago Tribune: Commercial sales outlook turns darker
… since the summer, sales in the commercial real estate market have slowed radically as financial institutions and debt markets reel from the fallout of years of ill-advised financing.
… as the economy slows, real estate fundamentals such as rents and vacancies seem destined to weaken, and some […]

Click on graph for larger image.
Office vacancy rates have spiked in California’s Inland Empire and Orange County according to the USC Lusk Center’s Casden Real Estate Economics Forecast.
Jeff Collins at the O.C. Register reports: USC sees vacancies chilling O.C. office rents in ‘08
Construction of new office buildings and layoffs in the financial services and […]

From CoStar: TROUBLE IN TEXAS: Huge Multifamily Owner Nears Collapse (hat tip Nick)
MBS Cos., one of the largest multifamily property owners in the country, is delinquent, in default or in danger of becoming so, on more than $900 million in loans.
… if MBS defaults, it … will … generate a huge spike up in CMBS […]