Real Estate News

Reuters is reporting that the credit crunch is hitting the commercial real estate industry particularly hard. They cite two of the biggest real estate service companies, CB Richard Ellis Group Inc and Jones Lang LaSalle Inc as experiencing plummeting sales volume.

CB Richard Ellis Group is particularly hard hit, losing 88% of their sale volume compared to last year. The Reuters piece says that commercial credit is next to impossible to get these days, and that most of the deals getting done are happening because either the seller is taking back financing or there is an assumable mortgage already on the property.

This raises an interesting question. The latest stimuluses passed by Congress and signed by President Bush into law are aimed at helping and supporting the consumer real estate market. None of it is aimed at helping the commercial market. So what can be expected here? Well, unless something changes drastically, this could be very bad news indeed for the commercial real estate market in the forseeable future. Don't be surprised if this industry segment becomes the next poster child for the bailout mavens.