According to the Austin Business Journal, Lehman Brothers Holdings, Inc., the investment company that recently filed for Chapter 11 bankruptcy was a primary equity partner in a joint venture one year ago to buy most of Austin’s premier office space. Lehman Brothers put up 75 percent of the equity and provided debt financing on the deal. They purchased 10 properties totaling over 3.5 million square feet. Their purchases included the Frost Bank Tower, One Congress Plaza and 300 West Sixth – some of the most “coveted assets” in Austin. It is now predicted that as Lehman proceeds through bankruptcy it is likely that its Austin properties will come up for sale at a significant discount. Austin Business Journal states that, “. . . analysts and industry insiders have blamed Lehman’s demise partly on its position as the one-time biggest U.S. underwriter of commercial mortgage-backed securities.” Dan Fasulo, managing director of New York-based research group Real Capital Analytics Inc., states, “If there is a deal under the Lehman umbrella that may be in trouble, it’s the Austin deal” . . . “Everything has flipped upside down . . . If you had to sell such a portfolio now, you would probably have to sell at a significant discount.” Keep your eye on Austin’s premier office space to see what effect Lehman Brother’s bankruptcy will have on the local real estate economy.