Sunday, December 6, 2009
Well, the housing crisis now has a new addition to the default lexicon: Zombie Buildings.
Sounds pretty scary, eh?
Actually, this type of zombie might be even worse than the Night of the Living Dead version.
Why? Because these ghouls are very real.
Without a financial restructuring, the properties are likely to join a new trend—“zombie buildings,” which can't compete for new tenants because they lack the money to cover brokers' commissions and interior office reconstruction.
The number of zombie buildings in the Chicago area is likely to grow in 2010, according to a forecast by California-based Grubb & Ellis. For landlords, the trend means even top-quality office properties are likely to divide themselves into “haves” and “have-nots,” with the latter seeing their vacancy rates worsen because of the lack of financing.
Worst of all, the main holder of the mortgages for these creatures is none other than the Federal Reserve (through one of its legally-dubious Maiden Lane LLC entities).
Meaning that, this species of zombie building is the cruelest of all: the dreaded taxpayer owned zombie.
--Chad Emerson, Faulkner U.