Metroplex's Aging Properties Stoke Foreclosure Roster

"The biggest problem in my mind is the older apartments and older office buildings," George Roddy Sr., president of Foreclosure Listing Service Inc. in Addison, tells GlobeSt.com. His latest tally shows 1,015 postings for the first nine months of the year versus 924 in 2003's year-to-date total. On the bright side, he says no portfolios have hit the roster in nearly a year and no single area is getting pelted.

The increase in postings "is kind of to be expected with market conditions as they are," Roddy says. And, he predicts the final months to register about the same--106, which is what is up for sale in September.

Posted for the Sept. 7 courthouse sale are 16 multifamily properties, 17 land tracts, four retail centers and 18 buildings equally split between office and industrial sectors. The county breakdown has 46 in Dallas, 39 in Tarrant, 15 in Collin, six in Denton and none in Rockwall.

With September's postings already completed, the third quarter will end with 286 postings or 2% less than Q3 2003. Postings fell 21% in the last three months although the sector specific analysis isn't nearly as rosy of a showing.

Multifamily postings rose 83% in the last three months. Of those notices, 88% were placed on complexes built before 1987 and 65% were development pre-dating 1975. The balance of the analysis shows 23% of the posted properties were built between 1975 and 1986; 2% between 1987 and 1996; and 10% rose since 1997. "On the average, the older apartments have an occupancy rate in the mid-80% and this appears to be dropping," Roddy says in a press release. "Therefore, I expect that most of the multifamily posting activity will continue to be of these class C projects."

The pre-1987 properties on this year's sale roster have been 85% office buildings, 78% retail centers and 73% industrial product. "Aging improved properties appear to be the crux of the commercial foreclosure troubles in the metroplex," Roddy concludes.