Commercial RE and Credit, Look for Commodity Country Buyers

Credit is still crunched and commercial real estate will take a large hit with new builds and development teams. Building a new building takes a lot of credit, far more than turning over an existing building. However, transition teams will win out, expect office buildings to change original zonings and plans to accomodate different types of businesses. During 2001 to 2003, during a less severe credit crunch caused by 9/11 and still influenced by the dotcom boom and bust, I assisted in opening a couple of hotels that used to be office buildings in New York. Credit was hard to obtain and the win win for both the lessee and the lessor was to transition buildings that were corporate headquarter buildings for many years into hotels or other not planned or zoned for businesses. Unfortunately, the lag behind plans to actuality in real estate take many months.
Aditionally, look for buyers from Asia, Australia and strong commodity currency countries such as Canada, Russia and New Zealand to start looking for cheap buys in the United States, just based on the exchange rates. Commodities are pegged directly to the dollar, so is you trade gold, XAU/USD, or any other commodity, for now, you are also trading the dollar. As the United States keeps interests rates low, at zero, continue to watch these commodities soar, easy long-term plays, but take profit or lock in profit whenever you can dont get greedy. Expect these commodity countries to start looking around the US after 1st quarter next year, before any threat of an interest rate increase, which is the only way the Dollar will appreciate, in this current economic state. Although in this current economic environment foreign currency traders may look at tax cuts as a positive sign for the dollar, since US unemployment numbers are heavily followed, since there is no expected interest rate increases. Tax cuts will give employers an incentive to hire.