Next bubble: commercial real estate
Signs of economic stress are spreading across America's commercial real estate market, and experts say they may foretell the approach of a second credit crisis that could rival the residential mortgage debacle. Delaware is not immune. Buildings that have long been pillars of Wilmington's downtown office market -- the Brandywine Building, the Nemours Building and Citizens Bank Center -- all have been cited for indications of poor economic health in recent months. A former DuPont Co. building, the Brandywine Building, is only half occupied and running a roughly $700,000 annual deficit, according to Rob Buccini, a partner in Buccini/Pollin Group Inc. The company's portfolio includes a minority interest in the Brandywine Building, and another of its entities manages the building. In December, the loan was transferred to a special mortgage servicer, which manages problem loans, and described as in danger of "imminent default." Buccini/Pollin Group Inc., which proclaims itself Delaware's largest landlord, controlling 1.59m square feet of office space in Wilmington, has had a "rough, rough time," Buccini said.