Surprisingly, according to Scott, the belly of the Beast doesn’t have a too many real estate developers down there:
Getting the picture? Too many lenders at the trough, dwindling property values, no cash to use, too little time under bankruptcy law, and financial retribution for filing bankruptcy. I believe that if we do see a spike in real estate bankruptcies it will be attributable to prepackaged plans, most often to facilitate bankruptcy sales of distressed real-estate assets.
But take no false sense of comfort from that as we are still bleeding red ink. Things are likely never going to be the same as before we started this descent into the belly of the beast.
This is actually an informative article. It’s true you would expect more developer bankruptcies in this declining economy, but Scott (or whichever associate ghostwrote it) makes a cogent case that that is unlikely at least for the near future.
Nice work anonymous associate, I mean, Scott!