Misery loves company

(Via CJR's Anna Bahney, scroll down to item 2, although the bit slamming Business Week's non-interview of Richard Perle is worth reading as well), there is another real estate bubble looking to burst - commercial real estate:

Lending standards fell, starkly… it used to be that banks made loans for no more than 80 percent of the value of a property to ensure a healthy cushion of protection, but by the early part of 2007, loans were sometimes made for 120 percent of a property’s value.

We didn’t know that. And, it seems, Wall Street firms have been playing the same game of pass-the-bag-of-doo-doo with commercial-mortgage securities as they did with residential ones. In this case, large pools of securities are backed by just a handful of buildings; a couple of defaults will reverberate far and wide.

Wonder what kind of deal the corporate lenders and mortgage holders will get?

Wanna lay odds that they will be markedly different from those offered to holders of sub-prime mortgages?