Here's our summary of articles and data points on the commercial real estate market. It's part of Seeking Alpha's coverage of the real estate market and homebuilder stocks. Like all other topics and stock coverage from Seeking Alpha, you can have this sent to your Blackberry or desktop email by signing up for our no-spam free email subscription service.

Quote of the Day

"If the towns are empty, the stores and malls and offices will be empty, too." Nouriel Roubini, a former senior adviser to the White House Council of Economic Advisers and the U.S. Treasury Department. Roubini forecasts a bust in commercial real estate alongside the residential slump. (The Globe and Mail, Nov. 20th)

Commercial Real Estate

• Commercial Property Prices Down, Index Shows (Chicago Tribune, Nov. 21st): "Moody's Commercial Real Estate Index: In September, office sale prices fell 0.5%, and multifamily apartment properties dropped 1.0%. On the other hand, prices of industrial property rose 3.0%, and retail real estate was up 2.6%, according to this index. "In most markets around the country, leasing is holding up, but after a huge surge in the asset [sale] market that reached a frenzy during the first half of the year, we're backing off the peak," said David Geltner, director of MIT's real estate center."

• Commercial Real Estate: The 'Massacre' Gets Worse (Globe and Mail, Nov. 20th): "MIT's Center for Real Estate index: The value of U.S. commercial real estate owned by big pension funds fell 2.5% in Q3'07... Moody's: Commercial real estate loans represented a precariously high ratio of 118% of underlying real estate values in Q3... The value of commercial mortgage-backed securities - the bonds that underpin most commercial loans - tumbled 84% to $6.3-billion (U.S.) between March-October... Economist Nouriel. Roubini estimates that falling commercial prices could eventually open up a $100B-$150B crater of bad loans for banks."

• First Industrial To Develop 142,000-SF Site (Globe St., Nov. 19th): "First Industrial Realty Trust Inc., based in Chicago, plans to develop a 142,000-sf distribution building at 2000 Arthur Ave. The project is part of FirstCal 1, the company’s joint venture with the California State Teachers’ Retirement System. First Industrial acquired the seven-acre site from Quebecor World Inc., headquartered in Montreal, for nearly $6.5 million, sources say. Colliers Bennett & Kahnweiler represented Quebecor in the sales transaction. A cost for the project was not disclosed."

• Commercial Real Estate Shows Declines – Moody’s (Roy Mehta in Seeking Alpha, Nov. 19th): "Moody's investor service report: Commercial properties decreased 1.2% in September from August... The default rate for commercial mortgage-backed securities is about 0.4%, extremely tame compared to the current 20% rate for subprime home loans, but Moody's would not be surprised if the commercial default rate doubles or triples. However, the historical average is about 1%, so even if this occurred, it would not be too "alarming." A slight decline in values could create problems for owners who want to refinance their mortgages, especially those who have been only paying interest on their debt thus far. Such loans have been more popular."

• Commercial Property Now Under Pressure\ (Wall St. Journal, Nov. 19th): "Already there are signs of [commercial real estate] slowing in some markets. Grubb & Ellis Co.: Available sublease space swelled to 77 million square feet in Q3 from 73 million-sf nationwide in Q2, the first national increase in five years... [However,] National Council of Real Estate Investment Fiduciaries: Commercial property appreciated 2.2% in value in Q3. Moody's: NCREIF looks at appraised value while Moody's bases its values on actual sales. Research firm Real Capital Analytics: The credit crunch derailed a number of transactions in Q3'07... Sales volume for office buildings dropped below $8.5 billion in September, compared with an average of $11.5B in the Septembers of 2005 and 2006."

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