From David Ellis at CNNMoney: The commercial real estate dilemma
Luckily for banks, the commercial real estate time bomb just keeps ticking.
Banks have already recognized about $50 billion in losses, or about 60% of the estimated cumulative losses, according to real estate research firm Foresight Analytics.
After 13 months of consecutive declines overall commercial property values climbed 1%, according to most recent monthly reading by Moody's/Real Commercial Property Price Index.
Commercial real estate vacancies will continue to increase in 2010, while prices could tumble further during the year. Prices could fall as low as half their peak levels from 2007.
That can mean only one thing for banks: more losses.
Housing, commercial, unemployment: not a good combination.
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