Two Perspectives on Commercial Real Estate

A couple of interesting conversations….

The problem is debt, not commercial real estate, says Wells Real Estate Funds CEO Leo Wells.

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Newmark Knight Frank CEO Barry Gosin on the outlook for commercial real estate.

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Gosin’s point goes to why banks will not force a General Growth (GGWPQ) liquidatiol... the last thing they want is to own real estate they cannot sell.

Comments

[Joseph L. S...:]

Mr. Wells -- who might have just a small axe to grind as head of Wells Real Estate -- states the obvious without acknowledging the problem. He says, "There is no problem in commercial real estate. Them buildings don't know whether the market is up or down. There's a problem in debt."

Well, no kidding! Those of us who are concerned about commercial real estate firms' solvency don't believe the land is going to somehow evaporate. We simply understand that if you take on debt that is 600% the value of the property and you have to sell off the best of it -- at the bottom -- to pay down that debt, you are unlikely to continue as a viable business.

Sep 25 03:14 PM

[Roger Knights:]

"Well, no kidding! Those of us who are concerned about commercial real estate firms' solvency don't believe the land is going to somehow evaporate."

LOL!

Sep 25 04:19 PM

[Xela99:]

Steve Schwarzman of Blackstone Group(BX) once said during a guest lecture at Yale that "he started making easy money in real estate because buildings cant talk and they have don't personalities to deal with"(something along those lines).

Sep 28 07:12 PM