don't choke the chicken to lay the eggs

Like many of you in the industry, it came time to refinance one of our commercial real estate buildings. The 3 year term came due. Now with the slow down in the economy ( I refuse to use the word "recession" unless in a really foul mood) we have experienced vacancies that are above average. We have also given some rent concessions to keep certain tenants, and a few have just gone "dark" or out of business. This lowers your cash flow for as you know, expenses do not proportionately fall at the same rate.
This in turn is how lenders value your property, mainly on the cash flows. It came down to the point where we almost had to put more equity into the property to get to the loan to value(L/V) ratio required. If not, we could have been in default of our mortgage terms and basically out of luck. I am sure many of you have gone through or are in the midst of this quandary yourselves. Even though the new rate would lower our payments, they said at first we were possibly in default of our mortgage due to the L/V ratio. We have never missed a payment, always on time for 20 years. How ironic. Basically told it was due to the new lending guidelines and that since the institution in question had taken government bailout funds, their hands were tied. Well, we came in under their L/V after some lengthy negotiation and we did refinance.
But many others have not been so lucky I have to believe. It is a catch 22 in the real sense. When this will all change is any ones guess. I am sure when we come out of the downturn, commercial lending guidelines will be a new and different animal than before. I just hope it is for the better and lessons learned. Don't choke the chicken to lay the eggs.