“Delinquencies are up by a factor of five from a year ago. Even though commercial real estate lags the cycle, the numbers highlight the battle banks face in producing profits," said Nick Kalivas, equity analyst at MF Global Research.
- Property research firm Trepp LLC reported that the level of loans 30 days or more behind in payments climbed to 2.45% in March, with the credit squeeze making it hard for landlords to refinance their loans.
"We're very concerned about commercial real estate," said Bill Feingold, managing director at Newport Value Partners. He believes the stock market has gotten ahead of itself, rallying on earnings from banks and other companies that stem from cost cuts as opposed to growth.
- Net percentage of banks reporting weaker demand for commercial real estate jumped to 66% in Q2 from 55% in Q1.
- At the same time, majority of banks continue to tighten their lending standards on commercial real estate loans.
"Meanwhile, the majority of banks continue to tighten their lending standards on commercial real estate loans. Fully 66% of banks tightened standards and, though that is marginally better than the 79% in Q1, this tells us that we can expect continued declines in commercial construction the quarters ahead," Matus and Rosenberg said.
Source: MarketWatch
0 comments:
Post a Comment