I want to take just a few minutes to give a cursory overview of the differences between the housing market and the commercial property market. It is important to understand the distinction, because, in my view, the latter can work to offset current and pending damage to the former.

Moneynews.com reports the following:

NEW YORK — The percentage of U.S. homeowners who owe more than their house is worth will nearly double to 48 percent in 2011 from 26 percent at the end of March, portending another blow to the housing market, Deutsche Bank said on Wednesday.Regions suffering the worst negative equity are areas in California, Florida, Arizona, Nevada, Ohio, Michigan, Illinois, Wisconsin, Massachusetts and West Virginia. Las Vegas and parts of Florida and California will see 90 percent or more of their loans underwater by 2011, it added.

On the other hand, commercial property seems to be fairing very well. Here a summary statement from the website for the National Association of Real Estate Trusts (NAREIT):

“Over nearly half a century, the U.S. real estate investment trust (REIT) industry has become an important segment of the U.S. economy and investment markets. U.S. REITs have seen their equity market capitalization soar from $90 billion to roughly $200 billion in just the past 10 years. In the process, that growth has set the stage for the adoption of the REIT approach to securitized real estate investment across the globe.”

In support of the quote above, here is Jim Cramer, you know…that whacky, but very successful investor and CNBC host of the “Mad Money” show:

“I have Fed(eral) Realty, the best mall play. It’s up huge,” Cramer says.“How about Boston Properties, your friend Mort Zuckerman? The stock’s up huge. How about Brandywine (Realty)? Off a giant secondary, it’s up gigantically.””This market is on fire. I’m tired of hearing about the bears saying the next big down leg is commercial (real estate). This is the heart of commercial.”He advises investors to just “focus on the facts.”

From yet another REIT investor:

Jay Leupp, senior portfolio manager of the Grubb & Ellis AGA Realty Income Fund, tells Fortune magazine that given the recent volatility in REITS, “it’s best to buy on down days.”He adds that, “Track a portfolio of REITs you like and … catch them after they’ve come down from a high point.”

Unemployment nationwide is just about to go to 10% using official numbers. Using unofficial numbers, some estimate real unemployment at over 16% and rising. Either situation, by itself, is bad. (As an aside, the figures for July will be released tomorrow). Add to that housing values falling to levels below the actual mortgage cost, and we now have a situation where both unemployed and employed people are better off walking away from their mortgage obligations and forcing foreclosure. More foreclosures lead to more drops in housing values and more underwater mortgage holders walking away.

Beyond that, consider that it was the devaluation of property and the inability of people to pay their mortgages that led us into this mess. There were other factors, of course, but this was the spearhead that punctured the balloon that was floating our economy. Couple dropping home prices with pending inflation (dropping valuation of the dollar), and this dog chasing its tail just gets more wound up and vicious.

So, what can we do, as a community, to be more proactive in trying to limit the economic damage cascading in front of us? Well, the answer may lie in the commercial property market and investors. It should be obvious by now that K-Mart may have brought a temporary upgrade in the appearance of the Billerica Mall, but in the long run, it would have either come full circle bringing us back to the future, or it would have actually contributed to making conditions worse.

In my view, Jeff Parenti presented a good start to a mixed use overlay plan. Not only will it improve the appearance of the town, but it opens the door to a mix of investment by capitalist looking for a sound place to put their money or to establish themselves as a REIT (Real Estate Investment Trust). If you believe Jim Cramer and those like him, there are companies and individuals out there looking to make a deal. Finding these businesses and investors shouldn’t be hard. The difficult part is to get the executive branch of town government to make an effort to reach out to them; to extend to them an invitation to meet and evaluate a mixed use overlay as a unique opportunity to set a standard in real property commercial investment.

In the past, I’ve used the phrase, “due diligence” quite often. This proposed scenario is an example of how to take a first step to bring about effective and lasting change. First, it requires that an honest assessment be completed that defines precisely what we have. Next, it requires someone with a vision and the ability to persuasively articulate that vision sufficient to convince others that it is worth following. Then, a diligent effort to gather essential resources (such as investors) that make the project possible and to use or convince them to help achieve the ultimate goal.

Due diligence is a long, tedious, and often frustrating process that requires patience, perserverence and a dedicated effort to identify and eliminate obstacles and impediments to success, and to also identify strengths and motivational conceptions that can be used as reliable foot holds along the climb to success. It is that and so much more and has a basis in law.

I thought I’d just over an idea that supports Mr. Parenti’s proposal, because I believe it is a good and reasonable proposal. I also offer this scenario as a means of inspiring thought and discussion, because beyond Mr. Parenti, I’ve yet to hear anyone speak rationally on this topic. I believe, we have a great opportunity here, but like all opportunities, it requires some risk taking and a general acceptance of change as being a potential golden goose; not a hammer falling towards the anvil. Between the town’s appearance and its budget constraints, we definitely need outside help. To get that help, we, as a town need to draw them in by offering something inspirational in place of the usual and customary sniveling negativity.