A good friend in the business of commercial lending scared the stuffing out of me by predicting an eventual bank collapse in Europe. Whether or not this occurs, Europeans are shifting money from European banks to the US for safety. Specifically, they are buying our buying our bonds; hence our low interest rates. Kind of a QE3 of sorts without having to print dollars.
My feeling is that this trend will continue into 2012 and some of the European money will find its way into our improving commercial real estate market as they seek something better than a 1.9% return that the 10-year currently offers.
Barring some major geopolitical problem (in addition to the European Banking Crisis), I am bullish on the commercial real estate market heading into 2012.
