When one looks in the mirror everyday, it has been said that it is hard to notice change. I have been removed from NYC, where i was born and raised, for many years now. I have played poker with friends nearly every weekend for years in the city which has kep me looking into the mirror.
My regular game has been postponed many times as the host has had family issues to deal with, and is also hunting for a house as a country weekend retreat. As a result yesterday, was the first visit to the city in nearly 6 months.
After not being in the city and visitng usual haunts and favorite places to grab a bite to eat i have noticed an extremely high amount of commercial vacancies.
The city is always changing, people failing, moving on, or moving up. But i have never seen such a dramatic change as i did yesterday.
Call it anecdotal evidence, but it appears that the health of the economy is really for shit. If you can not make it in the busiest spendthrift city, how will you make it anywhere else ?
I’m not sure if this spells a commercial real estate bust, but it certainly can not bode well. Many warned of a another debacle from commercial real estate, which thankfully never quite materialized. It appears it is closer now than ever. Knowing that liquidity is tight, corporations need to refinance some $4 trillion in debt over the next couple of years. What effect will this have for commercial real estate ?
In addition to seeing so many vacancies, my mother was offered a six figure sum to move out of her flat. My mom is one of those lucky seniors renting a two bed & two bath for $478 on the upper west side. I ask myself why is she and many other seniors being asked to move out ? The landlord is the third generation of European descendants, and the family is worth well over $150 million dollars. The landlord has already sold 85% of the building and plays with corporate jets as a hobby.
The family owns at least a dozen other apartment buildings which all went condo over the last 10-15 years. I do not know him well, but i wonder why the rush to push out all the seniors and sell ? It seems like a small bit of money to make in comparison to his net worth. Plus it would behoove his wallet to sit on the apartments as the elderly expire in their own time.
At any rate, i couple these observations with all the stories of 20k applying for 877 jobs at Hyundai last week to surmise the horizon. Mr. Obama the private sector is not well.
GLT
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