The Other Shoe is Dropping

I sometimes think that business brokers are like the canaries in a coal mine as we are often one of the first to "smell" trouble. It appears that we are now in round 2 of business closings. Many of the marginal businesses closed within months of the downturn in the economy as most did not have the resources to survive any drop off of business. Round 2 appears to be effecting the more stable and substantial businesses who have exhausted their resources to fund operational losses and are electing to go dark rather than continue in business. This trend has been accelerated by the drawback of bank credit and the inability of many to secure "normal" lines of credit. Many pundits have suggested that the banks are "hoarding" money to ride out the potential collapse of the commercial real estate market. It appears that there is a strong element of "self fulfilling prophesy " to this strategy as the banks are contributing to the demise of the very tenants which are the lifeblood of the commercial market. For those with nerve, this may be a real buying opportunity.