We would like to get your thoughts on current commercial modification and loan restructuring.

The current market makes refinance in many cases difficult.

As a result we have been pursuing assistance for those who's Commercial Property loans are maturing or are in default and have not been able to find a lender to refinance with due to rising CAP rates and lower values

Lenders are already doing short term workouts and hoping the commercial market will rebound.

There will reach a tipping point when they have to take a hit on their balance sheets and foreclose. Many banks are trying to shore up their reserves before taking big losses.

It was the same that happened in residential real estate. Lenders were in denial in the beginning but reached a point where a sale was inevitable. There are tons of capital groups with tens to hundreds of millions of dollars in cash waiting for these deals to happen.

I'm seeing a lot of distressed commercial these days. And from what I've read, over the next year or two a lot of commercial property will become available at discount prices.

Here in CA, mostly temporary modification is being done. The banks are still not willing to do permanent mods of 3 or 5 yrs even. I predict that beginning next Spring banks will be more willing w/ loan mods and selling REOs instead of just notes.

It doesn't leave much room for anything else does it? Lenders will have to modify or foreclose. The economy isn't improving anytime soon.