Doron F. Eghbali Commercial Law Blog on Lawyers.com

Are Commercial Property Values Improving in 2010?

Tuesday, October 12, 2010 by Doron F. Eghbali


The latest data from Green Street Advisors indicate commercial property values were up by 30% compared to 2009 levels. Nonetheless, one should take a look at these data with caution as commercial property owners are having serious trouble paying their mortgages and many of these mortgages are coming due relatively soon.

SOME DETAILS

Green Street Advisors, a firm specializing in real estate investment trusts in CA, provided the following data:

  • Almost half of the loss in commercial property values from 2007 to 2009 has been recovered.
  • This means commercial property values has risen nearly by 30% from their nadir in 2009.
  • Nonetheless, commercial property values are still shy of their peak by about 20%.

SOME CAVEAT

The data, in fact, provide some solace from the real estate tribulations we are still experiencing. Nevertheless, commercial properties have jumbo loans and many of them are coming due relatively soon. Already, relatively many commercial property owners are either behind their mortgages or do not know how they would be able to refinance when their jumbo loans mature because of the still frozen credit market and probably their less than optimal credit scores.

In addition, the foreclosure morass involving banks executing residential foreclosure documents without complying with applicable laws may still deal another blow to the real estate industry as a whole. This blow may not spare commercial property sector, either.

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DORON EGHBALI is a Partner at the Beverly Hills Offices of Law Advocate Group, LLP. He Primarily Practices Business , Rea l Estate and Enter tainment Law. Doron May Be Reached at: 310-651-3065. For More Information, Please, Visit: HERE.

Posted at 18:23 PM
Topic: Commercial Law
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