IT WASN’T SUPPOSED to be like this. Commercial real estate was expected to follow residential real estate into the gutter. Over-aggressive lending terms, a decline in liquidity, rising unemployment, declining rents – it was the perfect storm for a commercial real estate collapse. Even as far into the US recession as a year ago, Elizabeth Warren’s Congressional Oversight Panel warned of the impending crisis. In a report in February 2010, the panel cautioned: “There is a commercial real estate crisis on the horizon, and there are no easy solutions to the risks commercial real estate may pose to the financial system and the public.
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