Hugh Finnegan, an attorney in the real estate group at Sullivan & Worcester LLP, agrees with Knakal, noting that financing is the biggest problem in the credit crunch. "The market was irrational a year ago because of what was being allowed to happen. It is irrational today on the opposite end of the spectrum." He adds that "the risk factor has swung back the other way. The appetite for risk is minimal at best."
 Finnegan |
Finnegan tells GlobeSt.com that he isn't surprised that New York City banks aren't on that list because "they are so disciplined. When you read about these failures, it is mostly one big borrower who focuses on one particular type of customer," he explains. "New York City lenders are very savvy and have a much more diversified portfolio."
Finnegan says that unless there is another turn in the market, he believes New York City mortgage lenders will get through this unscathed. "I think the mezzanine lenders have been, and will continue to be the ones to get hurt." He says that if the fourth quarter continues to bring bad economic news, particularly in the retail area, then the credit crisis may go on for an extended period, "maybe 2010 and beyond, depending on how bad it is."
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