Real Estate Downturn Will Create 360,000 New Jobs

Many of the challenges we face in the real estate sector are merely a repeat of what we experienced in the late 80s. What no one is talking about is the tremendous opportunity we have to create over 360,000 new jobs in our struggling economy over the next 12 to 18 months.

The domestic real estate industry represents $1.6 Trillion or 8.5% of the U.S.’s Gross Domestic Product. The global capital crisis is impacting all aspects of the real estate market including brokerage, development, asset management, lending, and the countless support industries to the real estate sector.

Background Information

As background, during the early 1980s, Congress granted the Savings and Loan (S&L) industry new powers. Among others, these powers included lower reserve requirements and the ability to expand lending products and invest in real estate ventures. It wasn’t long before Congress corrected this mistake and tightened regulations, but for many S&Ls, it was too late. In 1989, the Federal Government had to step in and bail out the S&Ls by forming the Resolution Trust Corporation (“RTC”). The RTC was charged with liquidating these financial institutions and disposing of failed real estate assets and mortgages from the S&L industry. By the time it all came to an end in 1995, 1,043 Institutions with more than $402 Billion in assets (much of it in commercial real estate loans) failed. This cost the United States taxpayer more than $153 Billion.

During the bailout, the Federal Government spent over $400 Million in administrative costs that were not billed back to individual receiverships. According to the GAO, those bill-backs plus the administrative costs totaled over $87.9 Billion. Data is not available on specific breakdowns, but it is reasonable to assume that these bill-backs included all kinds of service fees to vendors including lawyers, property managers, brokers, and countless vendors supporting the property disposal activities.

What we are experiencing today makes the S&L crisis pale by comparison. Guarantees and cash payments by the Federal Government now exceed $7.5 Trillion. So far in 2009, 45 financial institutions are now in the hands of the FDIC with assets exceeding $11.94 Billion as compared to 2008 where 25 banks failed with over $17 Billion in assets. Another 114 financial institutions have taken TARP money totaling over $168 Billion more. It has been estimated that hundreds of additional banks will fail over the next 12-18 months.

At the same time, both commercial and residential real estate values continue to fall in many markets around the country. CAP rates in many markets for high quality investment product are up over 300 bps from levels of just six months ago. This increase alone wipes out any equity from commercial borrowers utilizing traditional leverage ratios. Coupling this fact with plunging tenant demand and falling lease rates means that even high quality real estate assets are in trouble.

In the current real estate downturn, it is likely that commercial loan failures will follow a similar pattern as to the residential failures we are already seeing. Unlike the 1980s though, it is expected that the magnitude of failures we are anticipating will dwarf what we experienced during the RTC bailout.

Although many lenders still have performing loans in terms of debt service payments, it is likely that many will find that their borrowers are in violation of loan covenants due to declining real estate values. How these lenders treat these activities on the commercial side remain to be seen. Federal regulations dictate that when a loan is in default, lenders must set aside cash reserve at substantially higher levels. With cash in short supply, lenders will be challenged with developing a strategy that may include utilizing TARP funds.


After researching past history and integrating current challenges, we believe that the opportunity exists to generate over 360,000 direct and indirect jobs to deal with the disposition of problem loans on both the commercial and residential side during this down cycle. These new job estimates are supported by the over $42 Billion in estimated fees that will be paid for services required to work through the problem loans and assets that will be paid for services required to work through the problem loans and assets that we anticipate will be coming back to financial institutions.

Direct jobs are estimated to total over 145,000. Many of these jobs are high paying – including advisory, legal, property and asset management, appraisal, underwriting, and numerous other real estate-related jobs. Additionally, utilizing real estate industry multipliers, it is believed that another 210,000 jobs can be created that benefit from the spending generated by the direct job sector. These jobs include countless categories occupied by people who provide goods and services to the new consumers that the primary sector jobs will create.

It is not known exactly how many jobs were created during the RTC crisis. We can only surmise by reviewing the available government data that a large portion of the $87.6 Billion in RTC administrative costs related to industry jobs. With the Trillions of dollars in hard cash outlays and government guarantees, it is difficult to imagine that the size of the real estate challenges will not be substantially larger than during the S&L crisis. Therefore, we feel our assumptions are likely conservative.

Our hope this time, is that the Federal Government takes a different approach to disposing of the real estate assets that will be coming back to the lenders. Rather than creating new government entities and jobs to work through troubled assets (FDIC and a potential new government agency), it appears to make much more sense to take advantage of an experienced and existing distribution network (our existing banking systems) specifically those who have received TARP funding.

As taxpayers we have already invested in TARP funds to banks plus the takeover costs of over 70 financial institutions in the last two years alone. With an estimated investment exceeding $200 Billion, It seems to make sense to utilize, that infrastructure, to work through the problem loans and assets. The $42 Billion in estimated fees will go a long way to stabilizing these banks and helping them repay some or all of the debt they have borrowed from the American taxpayer.

Some may believe that Government has all the answers. But, there are many others who have faith in the ingenuity of American business and the entrepreneurs that are out there, working every day, creating private sector jobs. A wonderful opportunity exists for the Federal Government to take advantage of our existing real estate and banking infrastructure to put countless people back to work.

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Best Fitness Tips For Men

Being fit is important to boost your self esteem and self confidence. It also makes you more attractive and appealing. A fit and sexy body will also help you get away with deadly diseases like high blood pressure, diabetes and heart disease. You must take care of yourself all the time. There are some tips that men should know in order to be fit and healthy.


Before you begin exercising or executing your fitness activities, you must plan for it first. You must make your goals specific, measurable, realistic, attainable and time bound. It will be very good for you to write these goals so that you will know which step you must make.


Men must keep their mind positive and hopeful. You must get away with negative thoughts. Always remember that your mind can dictate your body so keep positive thoughts so that you will see positive effects in your body. You must think about positive things so that you will feel motivated all the time.


Men like you are expected to have strong muscles for physical tasks. Strong muscles can help you carry out the tasks assigned to you. It can also protect the vital organs in your body. Always remember that strong and well shaped muscles will make you feel good. It can also affect your mind condition.


Regular exercise will keep your body active and energetic. It will help you increase your endurance and resistance to stress. You can also join sports activities to maintain your physical activity. Swimming, bicycling and basketball are some of the best choices.


You can join group fitness classes to keep your physical activity active and to meet new people. Aerobics class is good. Group classes is advantageous because you will find support and encouragement from the group. It will help you to have deep motivation to continue the activity.


Most men enjoy extreme sports and mountain biking is one good choice for you. It will keep you fit and healthy. In mountain biking you will be able to see lots of splendid views and you can keep in touch with nature. You will surely feel refreshed and rejuvenated all the time.


Yoga is known to be good in keeping your mind and body healthy and relaxed. It is one good way to escape from your busy lifestyle. It helps you achieve proper breathing and habits. Also it can keep you calm and peaceful all the time.

Most men want to have a fit and healthy body. It will make you attractive and sexy. There are some things that you can do to keep yourself fit and healthy. You just need to choose what you prefer the most.

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Five Internet Affiliate Marketing Tips for Beginners

As a beginning affiliate marketer, you want to get lots of good tips– the kind that save you time, save you money and make your online business more profitable. If you are going to have that home in the tropics or that Porsche, you will want the very best tips you can find. The internet is filled with beginning affiliate marketing tips, but some places are better for finding them than others. If you search Google for affiliate marketing tips forums you will be given over a million results! So this small set of tips is intended to tell you five of the basics rather than have you go through Google’s million results.

First: Have a plan. Write it down. Do you know what you want to do as an affiliate marketer? Do you want to sell something that is of personal interest to you? Do you have a good idea of how to sell something online? Do you know how much money you are willing to put out? Do you know how much time and effort you will expend? Don’t just think about it. Write it down!

Second: Own your own domain. While there are free websites and there are expensive website designers, an affiliate marketer will want to be somewhere between free and expensive. Owning your own domain is something that puts you in a different league than the people with free websites covered with ads for other people’s products. And while there are many many ways to have a website without knowing or learning HTML, it is to your advantage to have some small amount of knowledge of what makes your website look the way it does. Again, Google is your friend. Online “beginners” information is available if you search for it.

Third: Join like-minded people in affiliate marketing tips forums to share the “what works” and “what doesn’t” of marketing online. If you happen upon something that works super well for you, don’t be afraid to share it. The internet is a huge place and there is undoubtedly someone who would like to have your information for something that may work for them as well as for you.

Fourth: Be single-minded in your affiliate marketing. If you plan to buy a program that teaches you affiliate marketing, make certain you check out what others think about it before you buy. Don’t buy every program someone offers, but find one that will enable you to make a living online. Make certain that your program comes from someone with lots of internet experience.

Five: And, lastly, make a decision to stick with your plan for a specific amount of time before you decide that it is or isn’t working. If you are willing to put time, money and energy into making your plan work then you will be more likely to find success than if you half-hearted work at your plan. Remember that oak trees are acorns that stood their ground!

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