Thursday, January 15, 2009

Let's call it a....secondary market

Business Week's Hot Property blog has a good post today about a CRE bailout. And perhaps we should all stop calling it that.

The NAIOP's proposal is: loan guarantees from Treasury and the FDIC. And they point out this is not unlike 2001-2002, when we all went through the wringers of terrorism insurance. That was a royal pain but we got through it thanks to the government backing. Do the same with CRE and it could be a win-win situation.

As the story points out, this is more a liquidity issue than an overbuilding one (at least for now...let's see what retailer goes under today), and guarantees instead of cash could go a long way toward getting critical refinancings done. Without that, who knows what?

So, let's spin is not a bailout. It is not a bailout. Nice mantra, huh?