Commercial property - Merrill warns of meltdown in Ireland

No kidding! … of course good old daftwatch points to commercial oversupply reflecting that of residential. Commercial is oasis no more for property agents.

daftwatch.atspace.com/daft_commercial.html

Question is, will our meeja report this considering the risk to a number of banks?

So those miserable yields and negative carries are going to look even worse soon. Maybe they’ll be able to jack up the rents…

This analyst has been quoted on here before
thepropertypin.com/viewtopic.php?t=4471

Cliquish, furtive and racked with denial. FUBAR

Let me get this straight … the Irish commercial property market is being held up by a cabal of wealthy private investors? These tycoons have agreed not to sell so that the inflated valuations can be maintained and they all… eh… “stay rich”?

Really? That contradicts about 60 years of game theory. :open_mouth:

If Merrills characterisation is correct, this is a classic case of the Prisoners Dilemma.
en.wikipedia.org/wiki/Prisoners_dilemma
The optimium strategy is to defect not to co-operate. Game Theory says the cabal is destined to fall apart. It will become every tycoon for himself.

Think about this as you watch the commercial pyramid scheme implode amid hysteria and acrimony.

I wonder if these private investors are the same geniuses who are plotting the revenge fund to buy Anglo shares. Trying to shut up shop even more? Taking their ball and going home?

The real threat to the banks is, of course, the commercial sector. The residential market is actually a much safer place. That’s because the process of approving loans is much more transparent and the risk is spread among the vast majority of the population, who are property owners. Maybe that’s why this site is so focused on residential - many posters are hoping to buy into this market over the coming couple of years.

Commercial property is in the hands of a limited number of wealthy investors typically using high levels of gearing. They are very like hedge funds. Very secretive.

The question remains how dependent are they on the Irish market and to what extent have they diversified out in recent years. If they are well diversified they won’t have a serious problem.

There will be much speculation, all of which I’ll ignore. We’ll know soon enough.

Ultra Ultra illiquid too.

A good mate wasted weeks in march with hordes of these cunts showing up at presentations on a ( shall we say) green energy with a guaranteed market and a guaranteed route to market type project.

He needed some Mezzanine funds for reasons I cannot go into.

None of them had a penny of cash save for one, and he must have seen 50 of them over that time . they are all allegedly worth at least €5m on paper, each. Most of them cannot pull out of the funds they are tied into.

They are not in the least diversified, Irish and UK commerical is all they do for the most part , along with a few Spanish holiday homes that are also underwater.

Watch Lexus dealers very very closely , OK :slight_smile:

Also featured in the Indo today:
independent.ie/business/comm … 93191.html
concluding with this snipped: