Commercial Real Estate:
Apartment Building Boom
Has Banks Lending Again

Commercial Real Estate | Costa Real Estate Digest

Photo: Bruce Bisping, Star Tribune

Commercial Real Estate Lending On The Rise

When the commercial real estate market crashed a few years ago, the banks pulled back and began a period of standing still. No one wanted to lend … on anything. After all, not only were they accused of all sorts of transgressions in their lending policies, but the market had turned stinko anyway. Better to simply sit things out on the sidelines.

Well, anyone who knows anything about markets … any kind of markets … will tell you that all "ups" have corresponding "downs", and then when one part of a market closes down that same market will present other opportunities to those who are aware. Markets change, and that's what we're seeing in commercial real estate right now.

The foreclosure orgy on single family residences has taken literally millions of folks who resided in their SFR units … and created out of them millions of folks looking for rental units. This, in turn, has created a demand that is causing a boom in multi-unit housing construction. Apartment buildings are being built all over the place … and banks are lending in this area.

Here's an article from Jennifer Bjorhus of the the Minneapolis Star Tribune that tells you what's goin on in that area of the country.

Banks coming back home in apartment boom

JENNIFER BJORHUS – "It's a sharp twist from the post-crash years when toxic concentrations of commercial real estate loans brought down so many small community banks and larger banks all but pulled out of construction and development lending. Construction and development …Minneapolis Star Tribune"
http://www.startribune.com/business/164971026.html


Commercial Real Estate Development Is A "Market Leader"

Commercial Real Estate is one of the "market leaders" in real estate. When it starts moving in a specific direction, the rest of the market sectors will usually follow along at some point. This kind of bank investment in commercial real estate development of multi-family housing is a good sign all around. The market in general is "shaking itself out". People who were forced out of one sector are finding a place in a different one and creating new kinds of demands and opportunities. This is a good sign all around.

Commercial Real Estate
 

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