Commercial Foreclosures Rising, But No Red Flag Yet

George Roddy Sr. of Dallas-based Foreclosure Listing Service Inc. calculates the year-to-date increase is 25% higher than last year. So far this year, 1,171 foreclosures have occurred versus 939 in 2002 and 812 in 2001. But, Roddy stresses, none of the properties has been the cream of the crop in Dallas, Tarrant, Collin, Denton and Rockwall counties. "Twenty-five percent is pretty unsubstantial because they aren't significant buildings," he tells GlobeSt.com.

"Foreclosure is a handy hammer for lenders to use," Roddy asserts, "but for the most part, it's pretty hard to find a lender who's not willing to renegotiate or bend." He predicts the total will rise another 10% to 15% before the year ends.

There is some undercurrent talk that some insurance company owners are toying with taking back some buildings, but there's been no concrete action as yet, according to Roddy. Truth is, he says, the region could have had more foreclosures than it has had given the economic conditions. Low refinancing costs and lenders' compromises seemingly have kept a lid on the action.

To date this year, 98 office buildings were foreclosed upon versus 69 in 2002 and 44 the year before. Industrial foreclosures stand at 87 year to date, 84 in 2002 and 51 in 2001. Seventy-seven owners of retail centers and buildings were hit with foreclosures so far this year while the number was 71 in the prior year and 83 two years ago. In the multifamily market, there were 80 foreclosures this year, 85 last year and 51 in 2001. Lenders took action against 428 miscellaneous commercial buildings to date this year, 317 in 2002 and 356 in the previous year. Year-to-date land foreclosures total 401 versus 939 last year and 812 in the prior year.