The Real Deal Miami

Commercial slump could be less severe than housing bust 

March 10, 2008 04:14PM

The commercial real estate market is only facing “a once-every-25-year
flood, not the once-a-century inundation facing the nation’s housing
market,” the Wall Street Journal reports. The credit crunch caused by
the subprime mortgage crisis has spilled over into the commercial
market, slowing down sales and driving down property values. Tenants
are benefiting, as developers offer deals to keep space filled. Some
big property owners, like Harry Macklowe and Centro Properties of
Australia, have been forced to sell properties to pay off creditors.
But losses could be limited by a lack of overbuilding and the ability
of most owners to keep up with their mortgages.