"The credit crunch that roared through the residential real-estate market is starting to bite commerical projects too. Yesterday, Ian Bruce Eichner, the developer of a twin-tower casino resort in the heart of Las Vegas, defaulted on a $760 million loan from Deutsche Bank AG after he failed to get refinancing. ...Moody's Investors Service warned last week that the corporate default rate for the construction and building industry could reach 12% this year and predicted a 6% default rate in the hotel, gaming and leisure industries. ... The Cosmpolitan includes 2,184 'condo hotel' units, which are condominiums that typically get rented out as hotel rooms. During the housing boom, speculators in cities such as Las Vegas, Miami and San Diego snapped up these units because they promised to rise in value while also producing rental income", WSJ, 17 January 2008.
Now Moody's tells us. Who needs 'em? I remember when I first saw a "condo hotel" deal thinking, "this is being offered because the hotel manager can't finance the property acquisition more cheaply. This is being offered to ignoramuses at the top of the market".
Now Moody's tells us. Who needs 'em? I remember when I first saw a "condo hotel" deal thinking, "this is being offered because the hotel manager can't finance the property acquisition more cheaply. This is being offered to ignoramuses at the top of the market".
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