Fallout for TICs
The CMBS market for TIC transactions has been dead for nearly a year. It was the standard for the previous four years. After reading this article, I don't think the CMBS option for TIC deals will be available anytime soon. Here is a long quote describing the impact of Lehman's bankruptcy on the CMBS market:

Lehman's collapse was the most dramatic sign so far that the financial crisis sparked by residential real estate is spilling over into office buildings, strip malls, hotels and other commercial real estate. The firm was one of the most aggressive lenders on Wall Street, making whole loans, bridge loans and packaging debt into commercial mortgage-backed securities, or CMBS.

About $4.3 billion of Lehman's $30 billion portfolio consists of securities. The prospect of that getting liquidated sparked the latest selloff in the CMBS market, as evidenced by widening spreads between the benchmark U.S. Treasury notes and the CMBX, a credit-market index that tracks the value of the bonds.

Apartment-building investors also are likely to feel significant pressure to sell as Lehman unloads its debt and equity pieces of the $22 billion purchase of Archstone, the large multifamily company with buildings concentrated in Washington, D.C., California and New York City. For months, Archstone had tried to sell assets to reduce debt, but met mixed success. It resisted for months lowering its prices, even as buyers balked. It has sold some complexes but not as many as it hoped, according to a person familiar with Archstone.

Prices are now likely to soften. In markets with apartment buildings that compete with Archstone, "there is no question that if you need to sell assets, you will try to get ahead" of the Lehman selloff, said Jeffrey Spector, a real-estate analyst at UBS. "Every day that goes by there will be more pressure on pricing."

I think that while caution is warranted, the fear of a CMBS meltdown is overblown, at this point - unless the banks cause it. Most of the CMBS defaults have occurred in development projects and many of these were residential developments. My concern is that unwarranted fears by otherwise willing lenders will accelerate problems in the commercial real estate market. Many loans in CMBS portfolios will need to be refinanced over the next few years, and a reluctance on the part of lenders could put strong properties in jeopardy. Bankers need not be lemmings (oxymoron), but TIC sponsors better start looking for alternative financing sources.