Commercial Real Estate and the Mayan Calender

As the date approaches, many fear the Mayan calendar which states that the end of the world will occur in 2012 – well, December 21, 2012 to be exact.  Hollywood seems to buy into it as they’re releasing a film of blockbuster potential aptly entitled “2012”.  Maybe the Mayans were referring not to the end of the world but a cataclysmic meltdown of the commercial real estate industry. 

Maybe not the entire world, but the Commercial Real Estate Industry is bad.

The commercial foreclosures that will be and already has started to trickle into the media will flood the market soon.  We’ve already started to see this with many big businesses going under but one industry is the newspaper and magazine industry.  Why are these going out of business?  Well, the online industry has had much to do with this as people are getting their information on the Internet and they’re not paying for it.  Why pay for something that you can have at your fingertips for free, literally!? 

Take the Newspaper business for example

If we take a step back at this predicament, the newspaper company that went out of business is not the only company suffering.  Landlords will now have to come up with money they are no longer receiving from these newspaper companies to pay the mortgage to the bank.  Well, if there is no newspaper company to pay the bills because subscriptions are down, then the landlord can’t pay the bank and now the commercial bank note is non-performing.  See where I’m coming from?  This is a huge problem and the newspaper industry is just one of many industries where banks are starting to fret about.  Distressed Bank Assets will start flooding the news soon and who knows, maybe December 21, 2012 will be the worst day in the commercial real estate industry…