Commerical Mods in Full Swing
Trepp LLC has reported that the number of loan mods for commercial RE has gone up a lot this year. 2010 has more modifications so far than 2008 and 2009 combined. And we’re only half way through!
This may turn out to be a semi-permanent solution to the foreclosure issue facing businesses, or it may just push off the problem a bit.
What do you think?
Basically, their information means that while businesses are still getting into trouble and delinquencies are rising, they aren’t rising as fast as usual.
That makes two months so far where the rate of delinquency has dropped. Experts aren’t sure if this indicates a trend or not, but we’re hoping.
These numbers were true across a broad spectrum of commercial properties, from hotels and multi-family properties, through offices and retail stores.
Now of course all of these issues are affected by the general state of the economy, most notably unemployment. This just creates a vicious cycle for stores trying to bring in money. But their modifications, it’s hoped, will give businesses enough time to build up as the economy recovers.
If it’s not enough time, then we’ll see numbers start to slip shortly. Or things will go down hill because modifications aren’t a long term solution.
Experts are divided, so I’d like to hear what you think. Leave a comment and let’s get the discussion going.
