The commercial real estate crash: was it cheap debt that made us stupid?

It looks like this article went to press just a little too early. As of yesterday, Tishman and Speyer have defaulted on Stuyvesant Town:

http://online.wsj.com/article/SB1000142405274870353510457464...

Check out the photo on this story from 2006, and compare it with the one from The Atlantic.

http://www.nytimes.com/2006/12/31/business/yourmoney/31speye...

Two photos taken seconds apart, but used in very different circumstances.

I would agree with your heading. Found this interesting article.

http://blog.firsttuesdayjournal.com/?p=2231

No way would I ever become an owner in a rent-controlled building. You're dealing with a free market in your finance, and your income is anything but a free market.

"Landlords, however, typically take out commercial loans for shorter terms of three to 10 years. In normal times, landlords coming to the end of a mortgage simply roll the debt over into a new loan. But collapsing asset values have wreaked havoc on this process."