One plan calls for Treasury to ask Congress to create apublic-private fund that would provide money to small banks out ofthe $700-billion TARP fund. The small banks would use the funds tomake loans to small businesses.

Another approach reportedly under consideration would haveCongress create a $30 billion fund, consisting of $10 billion inprivate investments and $20 billion in TARP money. Privateinvestors would take the first losses if the money wasn't repaid.The Treasury Department did not return a call to intime for publication.

How, or if, such a fund would impact the commercial real estateindustry is unclear – certainly the funds would be lent out acrossmany different sectors, not just the commercial real estateindustry. Still, though, given that community and local banks havefilled to a certain degree the gap in real estate finance createdby the CMBS market, it would seem that such a move would be atleast of indirect benefit.

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Erika Morphy

Erika Morphy has been writing about commercial real estate at for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.