For the next few years, I had to repeatedly explain that this was a whole different recession. I would not be raising a fund because there was no wave of grave-dancing opportunities in commercial real estate. With low to nonexistent interest rates, there was no cost to lenders to carry assets on their books. Now the real estate lending industry’s mantra was “Extend and pretend.” A rolling loan carries no loss. In other words, leveraged property owners could extend maturing loans until conditions improved. Since they weren’t forced to sell, there was no flood of bargains.
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