A recent article in the Puget Sound Business Journal highlighted the CFO of Wells Fargo.
Since the article is behind a pay wall, I will outline the highlights/ lowlights and give my take as usual.
CFO Mike Santomassimo had the following takes on the state of the CRE market:
"Commercial Real Estate Office fundamentals have not changed and remain weak".
"We expect CRE office losses to be "lumpy" as we continue to actively work with our clients. We are 18 months into seeing the losses materialize...we have 'quarters' to go.
Weitz - I'm laughing as I expected this article to be so much more (more terrific journalism these days), but since we've gone this far, I won't waste the quotes as as the premise is still material for our purposes.
When Bank CFOs are telling listeners on a earnings call where they typically will paint as rosy picture as possible to maintain or boost stock prices, its worth listening. Obviously, all CRE is local and some markets will fair better than others, but this general opinion matches my thoughts in that both owners and lenders and 'kicking the can' and praying for miracle to save them. At some point, they will have to take losses barring a dramatic shift. That could be very, very....very.....ugly.
As our new President takes office, I commend his pro-business mentality, but I don't see him have the power to turn the ship around for better or worse.
For more information on Snohomish Commercial Real Estate, follow this blog or shoot me an email.
Have a great weekend,
Scott Weitz
www.weitzcommercial.com
t: 206.306.4034
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