According to an article in the Dallas Morning News, Richardson Heights Shopping Center which has been in business for over 50 years is facing foreclosure .
The article said:
The owner of the 220,000-square-foot retail center is in default on more than $32 million in debt, according to information from Addison-based Foreclosure Listing Service.
The Richardson shopping center is not alone; nearly 200 commercial real estate properties with debts totaling over $468 million are scheduled for foreclosure in June. These foreclosures are occurring at a record pace because many commercial real estate companies can no longer finance their debt.
The access to credit is simply no longer there, which means they don’t have the power to refinance and avoid foreclosure. Commercial real estate investors are in the same boat as the residential real estate owners who often have adjustable rate mortgages and are facing exploding interest rates that are pushing their monthly debt obligations up by double or in some cases three times more than what they originally signed up for.
These adjustable rate mortgages are pushing commercial real estate investors (and of course individual homeowners) into foreclosure and sometimes bankruptcy as they struggle to keep their property. We haven’t seen the end of this rising foreclosure crisis gripping commercial real estate, this is only the beginning. Many more adjustable rate mortgages are scheduled to reset within the next two years.