Now a New York research company, Real Capital Analytics, has compiled data showing that at least $107 billion worth of income-producing property — including hotels, offices, apartment complexes and warehouses — is already in distress or is headed in that direction.
More than 1,000 properties are clearly in trouble, he said. Owners of about 200 properties have surrendered the keys to their lenders. Another $21.2 billion worth of buildings are categorized as troubled based on one or more of the following criteria: foreclosure proceedings have been started, the property owner has received a notice of default, a receiver has been appointed, or the landlord orsole tenant has filed for bankruptcy protection.
Standing on the precipice of distress are more than 3,700 properties, valued at $80.9 billion, Real Capital Analytics said. This category includes $40 billion worth of properties whose owners are suffering financially. It also covers $26 billion worth of buildings with loans maturing next year, when credit is expected to remain tight and borrowers will probably be unable to refinance their properties unless they accept much more onerous terms. They could be forced to reach deep into their own pockets to hold onto properties that have declined significantly in value.