Commercial mortgages could be the next wave of delinquencies and foreclosures in the real estate market. An article published in Bloomberg in January 2017 estimates that about $90 billion in debt will come due in the next year. Much of this debt was created during the 2007 real estate boom and will need to be refinanced or otherwise dealt with by companies across the U.S.
Retail Properties Likely to Be Hardest Hit
The waning popularity of shopping malls and reduced interest by anchor companies has led to the failure of many of these large-scale retail properties nationwide. A number of retail properties are simply failing to generate the expected income. This can make it difficult for property owners to manage the costs of these retail sites and may lead to delinquency even before these loans mature.
Refinancing Harder to Find
The reduced profitability of commercial property combined with the tighter money market have made it more difficult for borrowers to refinance their current loans. If refinancing arrangements can not be found, commercial property owners may be left with no alternative to delinquency, default and foreclosure.
Prices May Be on Their Way Down
The expected increase in commercial foreclosures will present new opportunities for investors in this sector. Businesses looking for additional space for their operations and companies eager to get in on the ground floor of new retail expansions may find bargains in the commercial real estate marketplace. This will likely lead to increased demand for commercial title searches and closing services in the upcoming year.
National Title Insurance and Search Solutions from Acuity
The title insurance and title search specialists at Acuity National Real Estate Solutions can provide cutting-edge solutions for real estate agents and lenders to ensure the smoothest transfer of property. We handle escrow funds and closings to help you manage your sales more effectively. Call us today at 502-238-7500 to discuss your needs with one of our professional staff members. We look forward to working with you.