Yes, Commercial Real Estate Diving Too
Watching the financial news wires these days is kind of like waiting for a tidal wave. You know the bad news is coming, and you can't do much about it. That must be a familiar feeling for the pashas of the New York City commercial real estate market.
Along those lines, a new report by Real Capital Analytics says 32 commercial properties in the metro area are in some form of financial distress--involving bankruptcies, late mortgage payments, defaults or foreclosures--and another 236 are troubled, including some high-end cathedrals of the office life like Worldwide Plaza over on 8th Avenue and the Bertelsman Building at 1540 Broadway.
RCA lists both the 1.6 million-square-foot Worldwide Plaza and the 900,000 square foot Bertelsman Building as "troubled." Both properties are owned by Macklowe Properties, a major real estate player, and the lender was Deutschebank.
Macklowe was one of the firms hit sharply by the credit crisis, forcing the firm to divest itself of interest in several skyscrapers.
Another distressed property is a large Harlem hotel project planned for 1800 Park Avenue, which is listed as "stalled."
In pure real estate value, New York City leads the nation, RCA says, with $3.4 billion in "distressed" properties and $8.5. billion in "potentially troubled" properties.
"Since September, a wave of defaults and foreclosures has hit the commercial property market, and the magnitude of the situation is becoming clear," the report says.
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