Commercial real estate developers and sponsors are facing a massive problem as building prices in San Francisco plummet. Buildings that could have sold for $1,000 a square foot are now selling for $200 to $300, representing a fire sale at 10 to 20% of their replacement cost. This has led to potential loan impairments of 30 to 40%, with lenders facing markdowns on their debt. The distressed situation is evident in recent sales and the difficulty of rebuilding in a costly and complex market.