Investor Wilbur Ross Sees `Huge' Commercial Real Estate Crash Ahead for U.S. Assets

[marmar]

Wilbur Ross Sees ‘Huge’ Commercial Real Estate Crash (Update3)
By John Gittelsohn and Thomas R. Keene


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. ............(more)

The complete piece is at: http://www.bloomberg.com/apps/news?pid=20601087&sid=aoRYl03Rw1_g

[AllentownJake]

1. This is going to be nasty

and it's going to reach full steam in the Spring of 2010.

[Subdivisions]

2. `Huge' Commercial Real Estate Crash ....

Heck, I said that on this very forum months ago and I'm just an under-educated prole. Glad to know this billionair finally caught on.

[Birthmark]

3. He's only a couple of years behind DU

The folks on Stock Market Watch have warned of this for a couple of years (or more.)