Commercial real estate appears to be in same quagmire as residential

Calculated Risk has several good posts on this, but today CR pointed out a Bloomberg piece with the following quote:

U.S. commercial real estate prices may fall as much as 15 percent over the next year in the broadest decline since the 2001 recession as rising borrowing costs force property owners to accept less or postpone sales. ``People aren't willing to do deals right now,'' said Howard Michaels, the New York-based chairman of Carlton Advisory Services Inc., ... ``The expectation is that prices will come down.'' Investors in July bought the fewest commercial properties since August 2006 and apartment building acquisitions were down 50 percent from June, data compiled by industry consultants at New York-based Real Capital Analytics Inc. show. ...``There are so many deals falling apart,'' said David Lichtenstein, chief executive officer of Lakewood, New Jersey- based Lightstone Group, an owner of more than 20,000 apartments and 30 million square feet of office and retail space. ``People who can get out are getting out.''

I added some bold highlights...it appears to me that the loosening of lending standards took place in CRE as well as in residential; not a big surprise there. So it makes sense that CRE would be grossly overvalued now that credit is tight. It seems a bit surprising that apartment acquisitions would be down as there are a lot of people who are going to be foreclosed out of or forced to sell their homes and therefore will be looking for rentals.