CBRE’s Enoch Lawrence (left) and Sam Chandan of Real Estate Econometrics

In a sign of how troubled the market for bonds backed by commercial
real estate may be, and by extension, the future of some office
building owners, a key deadline for federal bailout money designed to
get money flowing again to landlords has come and gone without any
takers. Up until June 16, investors in those bonds, like insurance companies,
hedge funds and credit unions, had been invited to dip into the Term
Asset-Backed Securities Loan Facility, or TALF, to borrow some of the
$200 billion fund set by the Federal Reserve Bank of New York. The chief reason there’s been zero interest in TALF so far, according to industry analysts, economists and brokers, is that there hasn’t been enough time to put complicated deals together. Indeed, it was only in May that the Fed announced that commercial mortgages would be eligible for TALF money, and a month wasn’t long enough for lenders to market their assets to willing buyers, they say. [more]