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Defaults May Rise Until 2010 in Markets

CHICAGO-All markets are being hit, with companies such as Steve & Barry's facing possible bankruptcy.

By Gina Kenny | Updated on July 06, 2008

CHICAGO-Defaults are at an all-time high; particularly in the Chicago area and Midwest. Residential has led the way, but a few sectors of commercial real estate have not seen dramatic increases in defaults. Local experts are not expecting to see an end in sight until late 2009 or early 2010.

“Whether it is single-family residential (or) condominium residential, some form of residential clearly was kind of the first domino that fell in the path,” says Donald Shapiro, president and CEO of Foresite Realty Partners LLC. “Since then, I think the number of defaults have escalated into a significantly greater portfolio of commercial properties.”

The one area the residential sector that has not been as impacted is multifamily rental residential properties, says Larry Silberman, SVP and department manager for Fifth Third Bank Chicago’s real estate department.

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