The Next Shoe to DropPosted on April 8, 2009 in Arizona Law Regarding Business and Real Estate
In 1988, one of my first legal projects was to get a bank from Colorado off the back of a local developer who had built a shopping center. It turns out the bank was fearful that Arizona was about to enter a bad season in commercial real estate, the only problem was the developer was really not in default. The judge slammed the bank & by the time we cut a settlement deal with them, the market had really corrected. They should have waited and played fair. Declaring bogus defaults hurt them.
Now, the next shoe is about to drop because of commercial loan resets. Commercial landlords continue to lose office & retail tenants at an accelerating pace, indicating that the industry’s troubles are worsening.
The amount of occupied space in U.S. shopping centers and malls declined a net 8.7 million square feet in the first quarter of 2009, according to real-estate-research company Reis Inc. The amount of occupied space lost in that one quarter was more than the total amount of space retailers gave back to landlords in all of 2008 and any other year in recent history, according to Reis. It makes 1988 look like a cake walk. If you need help dealing with the ever changing real estate market give the Scottsdale law firm of William A. Miller a call at 602-319-6899.