Bank Notes
Co m m erci a l Fin a n cin g N e ws
Hope and Anxiety KC Conway takes a look at what’s ahead for commercial real estate in 2012. 2012 is beginning in much the same way as
2011: hopeful yet anxious. At the beginning of 2011, U-3 unemployment—defined as unemployed individuals actively seeking jobs in the past four weeks—was at 9.4 percent. The fourweek moving average for weekly jobless claims was above 400,000. The price of oil hovered around $90 per barrel (up sharply from $77 per 14
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knowledge leader Spring 2012
barrel in mid-2010). Inflation was on the rise due to the spike in energy costs. And we were seeing record annual home foreclosures: 1.0 million in 2010 compared to 918,000 in 2009. On the flip side of the coin, manufacturing expanded every month in 2011, and proved to be the “little engine that could” in the U.S. economy. The purchasing manufacturers index
(PMI) closed out 2011 with its 17th consecutive month of expansion and readings above 50 (the threshold level for growth). The “hope” for commercial real estate at the onset of 2011 was the capital and commercial mortgage-backed securities (CMBS) markets. Although delinquencies continued to rise above 9 percent, interest in new issuance was bullish. knowledge-leader.com