Wilbur Ross Sees ‘Huge’ Commercial Real Estate Crash

[Joanne98]

Oct. 30 (Bloomberg) -- Billionaire investor Wilbur L. Ross Jr., said today the U.S. is in the beginning of a “huge crash in commercial real estate.”

“All of the components of real estate value are going in the wrong direction simultaneously,” said Ross, one of nine money managers participating in a government program to remove toxic assets from bank balance sheets. “Occupancy rates are going down. Rent rates are going down and the capitalization rate -- the return that investors are demanding to buy a property -- are going up.”

U.S. commercial property sales are forecast to fall to the lowest in almost two decades as the industry endures its worst slump since the savings and loan crisis of the early 1990s, according to property research firm Real Capital Analytics Inc. The Moody’s/REAL Commercial Property Price Indices already have fallen almost 41 percent since October 2007, Moody’s Investors Service said Oct. 19.

Billionaire George Soros, speaking today at a lecture organized by the Central European University in Budapest, said a “bloodletting” may be coming for leveraged buyouts and commercial real estate.

“The American consumer will no longer be able to serve as the motor for the world economy,” said Soros, 79.

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http://www.bloomberg.com/apps/news?pid=20601087&sid=amPXzjQV3nGQ

[Adsos Letter]

1. Intersting times, interesting times...we are living in interesting times...

as the Chinese would say.

[Vincardog]

2. The only question is "How will the disaster capitalists profit from the crash?"

[Festivito]

4. There is only so much land. Once "they" own it, people don't matter.

Votes, vote counting, the fairness of judges, all can be bought.

The falling prices make it easier to own most everything. Next, drive the rest of the owners out.

You'll have to lease land to start a business, and "they" will legally take your profits.

At least, that's the way I guess it will transpire.

[Vinnie From Indy]

3. This is not complicated in my view

Corporate America has abandoned the workers in America. They do not need nor do they want to have to pay living wages. Globalization has made it a race to the bottom and the very first victim in the race was the American worker. No jobs - no money - big commercial real estate collapse. Simple!