CRE Crush Set To Increase Bank Failures By 30% This Year

9 West

Commercial Mortgage Backed Securities (CMBS) are in such bad shape that they might bring down 30% more banks in 2010 than 2009.

Data from the analytics firm Trepp shows that CMBS delinquencies shot up to 7.61% in March from 6.72% in February. Delinquencies of this size could bring many mid-size and regional banks down due to exposure to the market.

This isn’t just impacting commercial real estate in markets like Southern California or Detroit though. In New York, esteemed Plaza District office building 9 West is half empty.

The Plaza District in New York, which stretches from Third to Seventh Avenue between 42nd and 59th Streets, had its rate of vacancy double in 2009 to 14.7%.

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