Real Estate Investor Up Close

One of the big issues facing commercial real estate is the lack of financing for loans that are maturing. Property & Portfolio Research reports that $497 billion of loans from banks, insurance companies, commercial mortgage-backed securities and other sources will come due this year, with the annual totals declining only slowly to $451 billion by 2012. Of the $497 billion maturing in 2009, banks hold $365 billion or 73 percent; loans packaged into CMBS account for $36 billion or 7 percent; insurance companies hold $31 billion or 6 percent; and other sources such as private investors and government-sponsored entities hold $65 billion or 13 percent. Of the $365 billion held by banks, $237 billion are permanent loans, and $128 billion are construction loans. The lack of available financing to cover these maturing loans is pushing a steadily rising number of properties into foreclosure. In the first four months of 2009, according to Real Capital Analytics, foreclosure proceedings were