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Last week, leading, commercial real estate experts gathered at Georgetown University's McDonough School of Business to discuss where the CRE market is heading. An excellent Washington Post article, entitled: 'Delay and Pray' Won't Work for Commercial Real Estate" by Steven Pearlstein, gives a gloomy prospective of current market conditions. The article reports that there are almost no commercial real estate deals, no refinancings, no restructurings or foreclosures. Most investors are waiting on the sidelines looking for the CRE market to rebound.
Almost half of all commercial real estate is "underwater", owing more on their mortgage than current property values. Over a 1 trillion dollars worth of commercial mortgages are due to reset within the next few years and many owners won't be able to refinance.
The Washington Post article by Steven Pearlman goes on to say that commercial lenders are reluctant to foreclose on CRE because of the potential losses, due to declining market values.
Armed with this information, commercial property owners who can't refinance, are in default, or heading toward foreclosure can ask their lender or bank for a commercial loan workout. Banks are more willing than ever to keep profitable commercial loans on the books if owners were offered more favorable terms.
Commercial loan workouts can defer payments, allow for interest-only payments, waive fees, reduce interest rates and extend the reset date to avoid balloon payments. There are a few reputable, third-party commercial loan workout firms which can provide their expertise in making sure a commercial loan workout will have a good chance of being approved by lenders. Some firms now offer what is called "Rescue Capital" to provide funds from investors to give leverage, so that a lender may allow refinancing or other favorable terms.
For more information on commercial loan workouts, please visit: http://MyCommercialLoanWorkout.com