It appears the hot market of the TIC has cooled off. Investors jumped at the idea of grouping money together and leveraging partners to have the opportunity to buy a bigger investment. Mostly commercial investments. The idea that someone else found the partners and then managed the property, and then guaranteed the steady return on the investment, was hard to resist.
Unfortunately, the TIC investments are suffering just like other commercial investments. However, it is even harder when you have several investors now that can't agree on how to solve a tough problem.
Vacancies have also risen in the commercial industry in today's economy and the ability to raise more capital or refinance has become increasingly difficult with the current mortgage crisis. Especially when you have mutliple owners and a property that has not been performing.
Lastly, everyone realizes the exit strategy is harder than it sounded. When the chips are down, people want out. And in a TIC, it needs to be unanimous to have everyone cash out, or convince the others to buy you out, or you sell your portion publicly
For more on why TICs are not be producing, and where you should invest if you like the concept, see the presentation below:
