Close Up Look at Ugly NYC Commercial Real Estate

By Rocky Vega

10/08/09 Stockholm, Sweden – On October 6th, NewsHour with Jim Lehrer aired an episode covering the commercial real estate meltdown currently taking place in New York City. They so reasonably refer to the $3.5 trillion in outstanding commercial real estate debt as potentially the “other shoe about to drop.”

From the PBS website, “Just two years ago an office space in midtown Manhattan could fetch close to $1.7 billion. Today, the same property trades for about $600 million.”

At tip of the hat to The Money Game for getting this real estate wreckage on our radar.

Rocky Vega

Rocky Vega is a regular contributor to The Daily Reckoning. Previously, he was founding publisher of UrbanTurf and RFID Update, which he operated from Brazil, Chile, and Puerto Rico, and associate publisher of FierceFinance. He specialized in direct marketing at MBI, facilitated MIT Sloan School of Management programs, and has been featured on CBS. Vega graduated with honors from Harvard University, where he was on the board of Let’s Go Publications and directed business programs involving McKinsey, Goldman Sachs, and Harvard Business School faculty. He is also enrolled at the Stockholm School of Economics.

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3 Responses

1. Diddley Don't said

   That guy is incredulous.

   The other shoe is about to drop?

   The other shoe has already dropped, it’s just the shock wave that’s taking its sweet time getting here.

   And, I still can’t believe that anyone with any common cents would pay $600 million for a half empty building.

   When this is all over, some crafty real estate moguls will own some buildings at a steal.

   on October 8, 2009.
2. sharonsj said

   When this is over, the RICH will own everything and the rest of us will be screwed.

   on October 9, 2009.
3. David Milton Maxwell said

   when I was a teen in late 70’s in Chicago, there was an amusement park ride where you go in a huge circular cylinder, you stand against the wall, it starts spinning faster and faster, the centrifical force holds you against the wall > THEN they dropped the floor and like magic your not touching the floor.
   It’s all good until the cylinder started slowing down, and then you started sliding down the wall, and collapsed on the floor exhausted and no more force to hold you up off the floor.
   JUST LIKE the USA economy, it’s spinning slower and slower, no more credit glue to keep us up off the floor. Were ALL sliding down to the floor, and were all going to end up on the floor economically and it’s going to be UGLY, really really UGLY. Think 1934, except much much WORSE. YOU read it here FIRST.

   on November 1, 2009.