It's not only residential real estate that is experiencing troubles, commercial real estate investors got caught up in this subprime mess as well, and many commercial properties in New York City are feeling the crunch. Commercial real estate speculators looking to cash in on the real estate boom are now holding mortgages for not only more than their properties are worth, but having to make payments for more than they can rent their real estate for.

Commercial loans were made on many NYC properties with little regard for proper accounting, and the blowback on these loans is enormous. Many banks gave investors interest only loans, so commercial property owners have been able to delay foreclosure for now, but they will have to make full payments soon. It will be tough for them to do, with a decrease in rental income from their property and many owners competing for renters in New York City.