Even though distress of commercial properties is high, not all-retail real estate is created equal. Unanchored strip centers in regions with high unemployment and deep housing trouble, as well as loans originated in 2006 and 2007, are disproportionately in distress.
Retail centers with loans originated before 2006 are better positioned to lowering rental rates and therefore avoiding a high amount of vacancies and mortgage default.
Unanchored strip centers are experiencing bigger problems than grocery-anchored strip centers and regional malls. These properties have problems carrying smaller vacancy rates and erosion of property income due to vacancy increases with the prolonging economic state.
Look at Anchored strip centers for a solid investment base that will grow as the economy eventually recovers. For information email me at: mbracket@hotmail.com
2/22/2010
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