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Sikon Construction Corp.'s Scott

'Some kind of program has to be put into place to address the amount of these loans.'

By Carl Cronan | Updated on August 10, 2009

As Vorando Realty Trust and Developers Diversified Realty seek help from the Term Asset-Backed Securities Loan Facility (TALF), but respondents to last week’s GlobeSt.com Quick Poll aren’t in favor of such a move. A 61% majority of readers indicate that they “are wasting their time trying” while 39% think they should get TALF funding. Dale Scott, senior executive vice president of Deerfield Beach, FL-based Sikon Construction Corp. and state director of the International Council of Shopping Centers, sees plenty of retail REITs suffering in Florida and believes some sort of federal relief is needed to save otherwise winning developments.

“The value of assets has gone down so much that you’re in a situation in which loans are coming due and the gap in loan-to-value ratios has gotten bigger, so the only thing the owners can do is come up with the cash in between. In many cases, cash is just not available to developers.”

“Some kind of program has to be put into place to address the amount of these loans that are coming due over the next several years, and how much of that is coming due is confusing, but it is very substantial. Some of the pressure has to be taken off the companies to allow them to refinance these loans as they come due.”

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