Tuesday, March 10, 2009

TALF a Trillion for Commercial Real Estate

If you live in Florida one thing you notice is empty stores in malls. In Delray Beach we have one of those giant strip malls--lots of empty space. It is really startling to see. Restaurants in business for 20 years or more--gone. Circuit City, Linens and Things, you name it gone. And, associated businesses around these anchors--going, going, gone. The mall in Boynton Beach, Walgreens, now closing at 7 PM.
The goal is to head off a “looming crisis” that could spread far beyond “For Rent” signs and shuttered mall shops--Federal Reserve Chairman Ben Bernanke
“Empty stores in a mall deters shoppers just like it deters them in downturn areas if there is vacant space at street level,” says Todd Sinai, an associate professor of real estate at the Wharton School at University of Pennsylvania in Philadelphia. “Then if your retailers stop selling you cannot get new tenants.”
In carrying out the Financial Stability Plan, the Department of the Treasury and the Federal Reserve Board are announcing the launch of the Term Asset-Backed Securities Loan Facility (TALF), a component of the Consumer and Business Lending Initiative (CBLI). The TALF has the potential to generate up to $1 trillion of lending for businesses and households.

Here comes TALF to the rescue. One potato Wall Street, two potato banks, three potato homeowners, and a steak for commercial real estate.

The Treasury is readying a giant bailout for commercial real estate properties as rents fall and vacancies rise. Is this the next shoe ready to drop?

See Fed Press Release and Real estate woes seep into malls, office towers
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Bob DeMarco is a citizen journalist, blogger, and Caregiver. Bob has written more than 500 articles with more than 11,000 links to his work on the Internet. The content has been syndicated on Reuters, the Wall Street Journal, Fox News, Pluck, Blog Critics, and a growing list of newspaper websites. Bob is actively seeking syndication and writing assignments.

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