GE is a bellweather for the commercial real estate market as their vast holdings are fairly well diversified. Unfortunately the picture the company paints is dim.
General Electric expects to lose 13 percent more of it’s portfolio in 2010. That is on top of a 34 percent loss since it’s highs of 2007.
So if you are looking at commercial property, keep these numbers in mind. The expectation of profits from the sector are not likely until 2011 if not later.
Executives from GE Capital, a unit of General Electric Co. said on Tuesday that the company expects to have about $7 billion in unrealized losses in the battered commercial real estate sector. The executives, speaking at an annual investor day for the unit, said that the decline in real estate values has also driven down the value of its collateral for commercial real estate loans, lifting impairments on loans above previous expectations for 2009. via MarketWatch
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We all knew that the commercial crash was going to follow behind the residential crash. It is coming, and hopefully the residential market will have recovered enough to keep us moving forward with economic progress.
-Tyler