Starting your own business? Need some extra space for your needlepoint habit? You're in luck ... office space comes cheap these days. In fact, rent for office space is sliding lower at the fastest rate since 1995. In the third quarter, office rents dropped 8.5% on a year-over-year basis.

Falling prices typically go hand in hand with falling demand and in fact, vacancies are on the rise as layoffs increase. New York-based real-estate research firm Reis says the office vacancy rate has hit a five-year high of 16.5%. Last quarter, tenants returned 19.6 million square feet of commercial rental space to their landlords.

"Right now, I believe real estate investment trusts (REITs) are one of the worst places you can put your money; but there is one exception," says Tom Dyson.

In Daily Wealth, he looks to Realty Income (NYSE: O), explaining, "This REIT -- which has paid 463 consecutive quarterly dividends -- is one of my all-time favorite income investments." Here's his review.

"I see abandoned real estate all over my town. Half the businesses still operating are running on fumes. Our Kmart is a basket case. It's always empty. The Walgreen's is a teardown. Sears has gone. The carpet store has gone and they've boarded up the car dealership.

Listen up! Listen up to what Fed Chairman Bernanke has to say about commercial real estate. He said that the market for securities backed by commercial mortgages had "completely shut down." This is a serious if not devastating statement. Can we infer that the market for credit default swaps (CDSs) has shut down? If so we are at the brink of a new financial situation.

Mr Bernanke also stated that continued deterioration in commercial property with defaults rising sharply would present a "difficult" challenge for the economy. Prices for commercial real estate have fallen 35% since the market's peak.

TheStreet.com's Jim Cramer says the endless worries will prove bogus, and jobs creation could spur a real lift.

Alt-A. Endless bank foreclosures. Commercial real estate. These are the big three worries that will not be killed by data, rigor or common sense, no matter what happens.

Doesn't it occur to anyone that there already should have been a big spike in commercial real estate losses by now? That the decline in the economy has lasted long enough that it should have manifested itself? Doesn't anyone think that there should have been a big commercial real estate bad-debt bump at a Citigroup (NYSE: C) (Cramer's Take) or a JPMorgan Chase (NYSE: JPM) (Cramer's Take) or a Wells Fargo (NYSE: WFC) (Cramer's Take)?

Even while dancing on the edge of the Great Abyss one should keep one's eye on the numbers. In this case, the key indicators that presage an economy at risk of totally imploding. Sure, the auto sales numbers were no worse than grim expectations and the ISM manufacturing number was actually a positive. But, oh, we have lots of nasty numbers to go around. Start with the RevPar number. That's short for revenue per available room at hotels and is a solid indicator of the health of the travel industry, as well as the state of business travel spending. The number? Down a stunning 15.3% in the month of January, year-over-year.

It's a rough time to be a shopping center company and, arguably, General Growth Properties (NYSE: GGP) is in the worst shape of the lot. The company faces a whopping $27 billion in maturing debt coming due over the next four years. On Friday, Feb 20, it announced it had defaulted on loans. The Piqqem Sentiment on the company is negative. Shares that traded over $60 per share two years ago are now below 50 cents and are a favorite football of speculators betting that the syndicate of lenders will throw GGP a lifeline rather than eat the bankruptcy costs.

There might be a happy ending to this story, however. The company reports earnings on February 23 and it will certainly be an interesting report -- most likely grim numbers as staggering retailers pass on their shopping plague to the biggest shopping center landlord.

"Housing starts have swooned, foreclosures have jumped and home prices saw their steepest drop in 26 years," notes income expert Carla Pasternak, who nevertheless is suggesting a real estate investment.

In her High Yield Investing she explains, "Our money-making opportunity isn't based on the housing market; rather, it's with a REIT -- Omega Healthcare Investors, Inc. (NYSE: OHI).

"REITs and housing are both real estate, but that's where the likenesses begin and end. Property-holding equity REITs invest in commercial real estate. And commercial properties continue to generate steady cash flow from rental income, thanks to long-term leases.

"Above-average dividends are what allow REITs to pack a punch. These companies must distribute at least 90% of their profits to shareholders, making them especially attractive to income investors.

"Founded in 1992, Omega manages a $1.3 billion portfolio of over 200 hospitals and nursing homes in diverse locations across 28 states. The company leases the properties to established healthcare operators.