Any commercial real estate derivatives, indexes or ETFs out there?

N

nravo

Similar to the CSW housing market derivatives? Looking for ways to short commercial real estate, outside of shorting individual companies.
 
good question, and a good short idea. Commercial real estate has a long way to fall. Don't know of any pure play unless you have access to credit derivatives in which case CMBX is the way to go.

VNQ is a reit ETF and this has the disadvantage of being a hodgepodge of several different property types. There are other REIT ETFs too.

I would suggest targeting industrial, office and retail REIT individual names.

CMBX hits right at the securitized commercial mortgage market which has a loooong way down to go. The same investment banks and institutional investors that gave us the CDO/sub-prime debacle are at the center of this process, and don't forget the rating agencies too.

To add fuel to this, commercial real estate developers and owners either directly or through mortgage brokers are putting together the financials to get these loans. Commercial loan brokers are in my experience let's ahem, ethically challenge. Same incentive structure throughout as for resi loans. It's harder to completely fabricate the data in commercial, no NINJA loans here but its a big enought debacle to ride down.
 
good question, and a good short idea. Commercial real estate has a long way to fall. Don't know of any pure play unless you have access to credit derivatives in which case CMBX is the way to go.

VNQ is a reit ETF and this has the disadvantage of being a hodgepodge of several different property types. There are other REIT ETFs too.

I would suggest targeting industrial, office and retail REIT individual names.

CMBX hits right at the securitized commercial mortgage market which has a loooong way down to go. The same investment banks and institutional investors that gave us the CDO/sub-prime debacle are at the center of this process, and don't forget the rating agencies too.

To add fuel to this, commercial real estate developers and owners either directly or through mortgage brokers are putting together the financials to get these loans. Commercial loan brokers are in my experience let's ahem, ethically challenged. Same incentive structure throughout as for resi loans. It's harder to completely fabricate the data in commercial, no NINJA loans here but its a big enough debacle to ride down.
 
Quote from Diamond Geezer:

good question, and a good short idea. Commercial real estate has a long way to fall. Don't know of any pure play unless you have access to credit derivatives in which case CMBX is the way to go.

VNQ is a reit ETF and this has the disadvantage of being a hodgepodge of several different property types. There are other REIT ETFs too.

I would suggest targeting industrial, office and retail REIT individual names.

CMBX hits right at the securitized commercial mortgage market which has a loooong way down to go. The same investment banks and institutional investors that gave us the CDO/sub-prime debacle are at the center of this process, and don't forget the rating agencies too.

To add fuel to this, commercial real estate developers and owners either directly or through mortgage brokers are putting together the financials to get these loans. Commercial loan brokers are in my experience let's ahem, ethically challenged. Same incentive structure throughout as for resi loans. It's harder to completely fabricate the data in commercial, no NINJA loans here but its a big enough debacle to ride down.
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Nah, looking for something exchange-traded rather than OTC, so credit derivative swaps won't work for a little guy like me. I'm surprised the CME isn't working on something; this seems like an obvious play, like the residential market 18 months ago, when several shortable instruments were created. Not especially interested in shorting REITs, either; I hate paying out that dividend while I wait for the deluge. But thanks for the thoughts.
 
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