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When I did the first of my Random Walk series, I focused exclusively on the empty storefronts in Manhattan's Madison Avenue Gold Coast area. It was enlightening to many to see just how deep into the heart of the monster the CRE collapse had cut.

However, unless you look at the commercial real estate apocalypse unraveling in Central and Eastern Europe you ain't seen nothing yet. Whereas here if you have some spare cash you can buy 400, maybe 500 sq feet of prime commercial real estate in which to sell, uh, sodium hydroxide and lye, if you head east you really hit the jackpot. The problem is truly pervasive across all the countries I visited, but surprisingly nowhere is it as acute as in the EU's most recent (and corrupt) member state, Bulgaria.

After a 10 minute rambling trip I saw an astounding amount of brand new, glass walled, hyper modern office towers. Office, after office, after mall, after office, after car park, after office... Complete and total overcapacity meltdown. Nobody wants to touch these even with a Morgan Stanley AAA RE-REMIC. And the funniest thing is that between Raiffeisen (OTC:RAIFF) and UniCredit (OTC:UNCIF), builders of these very offices in 2007 were getting practically free credit at 100% LTV from the Austrian and Italian banks. To get a true sense of how bad it is, take the picture below and multiply by 100x for CRE and by 1,000x for Residential Real Estate, and that's just Bulgaria.

But ignore this house of cards: who cares if all these buildings are generating exactly zero cash... who cares if the problem is endemic to all of Europe - Zero Hedge's old friend Steve Sakwa took the opportunity yesterday to issue a report for ISI in which he praised REITs and was very positive on the sector overall (Zero Hedge will gladly dissect Sakwa's report tomorrow).Overcapacity? The word is banned from the lexicon of all current and former Merrill Lynch employees.

In the meantime, enjoy these pictures of pretty, if completely vacant, office buildings.