Today I was reading an update on Commercial Real Estate (CRE) - it seems that CRE is following the path that Residential Real Estate took two years ago!

 

Donald Trump just asked for more time to pay his $770 million in construction loans on his Chicago Tower, and many commercial developers are having a hard time making their construction loan payments, because absorption has been slower than what they anticipated on their business plans.

 

When the economy slows down = fewer jobs = less need for space. I think that to add insult to injury, we'll see many banks suffering from defaults in their commercial loan portfolio next year...this is probably not good news for anyone!

 

On the positive side, the uncertainties of Wall Street may force investors to re-think investing in real estate. At least in bricks and mortar you have a more predictable outcome for the long-term!