Financial Times FT.com

Risk of property defaults growing

By Daniel Pimlott in New York and Gillian Tett in London

Published: February 5 2008 18:47 | Last updated: February 5 2008 18:47

There is a growing risk of defaults on loans on commercial property this year, in a trend that could spill over into tumbling values and create more jitters in the credit world, analysts and bankers warn.

US property companies that took out big short-term loans to finance acquisitions in the past couple of years at low-interest rates are now struggling to refinance this debt, as banks curb lending and commercial property prices fall.

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