There has been a recent wave of commercial REITs announcing public offerings in the third quarter of 2009. Despite the seeming popularity of this business trend, there are some clear problems in the realm of commercial mortgage related REITs. The unifying theme among these REITs to go IPO this year is that many of the offerings were only able to raise half of their intended capital (or less). Furthermore, the weakened demand for commercial REITs is amplified by multiple firms postponing their initial public offerings.

The first of the recent REITS to go public and miss targets was CreXus Investment CP (CXS) which debuted on 9/16/2009. The original goal for this offering was to issue 33.3 million shares at $15/sh (~$500 million). They were only able to issue 13.3 million shares at $15/sh (~$200 million) or 40% of their target. Currently, CXS shares are trading at $14.16 (as of close on 10/1/2009), down 5.60% since its initial offering.