Although we are all feeling much better that the real estate market is improving, values are up and debt and equity are starting to come back, the problems are far from solved and the banking sector remains troubled. This will continue to cause limits to available debt financing for the majority of owners in non urban center locations. It will also cause limits to value increases for a few more years. While the major banks have all rebuilt capital, and the weak and badly managed are gone, the vast majority of small and regional banks continue to suffer from their real estate portfolio problems. Local and regional banks made the vast majority of land and construction loans for most of America. It was not CMBS, not JP Morgan and not insurance companies. It is those loans at those smaller banks which are weighing down the books of these same banks because they are mainly far underwater based on current values.

It is nice to read about the low cap rates being paid for top buildings in New York and

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