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It might ultimately be the banks who are in trouble. "For an office landlord, abandoning a building can be the best of bad options. Commercial mortgages on off
by dageshi 3y ago
It might ultimately be the banks who are in trouble.
"For an office landlord, abandoning a building can be the best of bad options. Commercial mortgages on offices are usually structured as “nonrecourse” loans, which means that only the building is forfeited in a default. "
https://www.curbed.com/article/nyc-office-real-estate-rechler-rxr-project-kodak.html https://www.curbed.com/article/nyc-office-real-estate-rechle...
This is a great article on the situation in New York, I highly recommend it.
- Animats 3y ago> It might ultimately be the banks who are in trouble. Commercial real estate landlords keep saying that, in hopes of a bailout. Whether it's a real problem for banks remains to be seen. It's a slow problem, and banks can generally deal with slow problems.
- bombcar 3y agoBanks can also do silly accounting tricks, like claiming the $1m building is the same as the $1m loan they foreclosed on, and carefully not update it or worry about cashflow.