With vacancy rates at 20-year highs, delinquent commercial real estate loans are on the rise nationwide.
According to The Real Estate Roundtable, $400 billion in commercial real estate loans are due this year. In two years, that amount is expected to go as high as $1.8 trillion.
Through the first three quarters of 2008, commercial property sales were 67% lower than for the same period in 2007, according to the Mortgage Bankers Association. Rent for office and retail space has nosedived while leases for industrial space were flat. Apartment vacancy rates are slightly up, the mortgage group's data showed.
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Credit unions have not been immune to the losses. Troubled commercial real estate loans have gravely impacted their bottom lines, forcing some to enter conservatorship or file lawsuits against borrowers to recover on the default transactions.
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