"However, it has also stalled a recovery in the commercial real estate capital markets as banks continue to extend maturities for their borrowers, avoiding foreclosure in a practice that is becoming more commonly known as 'delay and pray'." The upshot? It is unlikely that any true debt liquidity will return to the market until mid-2010 at the earliest, he concludes.

Assessments of the government programs designed to help the economy, and increasingly, commercial real estate, are becoming more commonplace as the government throws out hints that the programs will eventually be ending. The verdicts are all tend to run along the same theme: the programs forestalled the worse case scenario – but have not pushed the capital markets back to health or even regular activity.

TALF, for instance, which was recently extended a few months beyond its original expiration date of the end of the year, has provided a boost to the real estate financial markets, Bill Hughes, SVP and managing director of Marcus & Millichap Capital Corp., tells GlobeSt.com citing statistics from the company's recently released Government Programs and Debt Maturities' Special Outlook report.

At its first subscription date in July, the legacy CMBS component of TALF received requests for $670 million in loans and all but one of the bonds submitted were accepted as collateral for TALF loans. Furthermore at least two REITs are testing the new CMBS component of TALF, with each projected to borrow up to $600 million against assets in their portfolios. Most of the capital raised will likely be utilized to pay down maturing debt.

There are at least five CMBS deals coming to market because of TALF, he also says. "What TALF does is help renew activity in the secondary market because it juices yields," he says. PPIP, the Public Private Investment Program that the Treasury Department is in the process of rolling out will play a similar role for legacy assets. "None of these programs on their own can deliver a perfect solution for the industry problems – they each have a role to play," Hughes concludes.

Another factor to consider when evaluating these programs success is that much of the benefits have yet to be realized, Kenneth Riggs, president and CEO of RERC, tells GlobeSt.com.

"Right now you need to measure both the indirect and direct impact on the market because the direct impact has been very small – the programs are still relatively new and small in the context of the overall market." As both critics and advocates continue to assess the programs, he hopes they take into account the coming debt crisis that has yet to truly impact commercial real estate. "CRE behaved relatively well this cycle. We didn't overleverage or overprice at least not as much as in the 90s. But now we have been sucked into the larger economic crisis and it is going to surpass the dislocation of the 90s."

Indeed, the consensus from the industry is that the government is going to have to continue its support for industry capital markets in one form or another for some time. This may come as anathema to critics of the federal hand in these matters, of which there are many, both in Congress and among its constituents. There is case to be made for many of these complaints, starting with the efficiency of the assistance and the risk it holds for taxpayers. Consider, for example, the Mortgage Bankers Association proposal Wednesday to refine the government's role in the secondary security markets by realigning Fannie Mae and Freddie Mac through a new form of government guarantee called MCGE. To keep the securities attractive, risk based premiums would be paid into a federal insurance fund to protect against credit risk, Aite Group senior analyst John Jay observed.

The MCGE is placed in the first-loss position with the government in the second-loss position, he tells GlobeSt.com. If the claims exceed the government fund that MCGE is funding via premiums, direct government credit may be necessary to fulfill promised P&I guarantees on MBSs, he notes.

Despite the drawbacks to this and other proposals of ongoing federal help, though, the alternative is much worse. "Even though we've been beating the drum about this, I don't think a lot of people outside the industry realize the enormity of the losses that may be coming," Riggs says.