Downtown Los Angeles high rises are running on about a 30% occupancy rate at best. Two defaulted on roughly $750 Million in the last couple weeks, a whole lot more are prepping for Bankruptcy
The commercial real estate bubble has already popped but the pain has not really set in yet.
Predictions about the overall damage to the economy this crisis will cause are all over the place, but it won’t be good. The numbers are staggering and few are considering the real implications for urban areas where small businesses that relied on these workers to stay afloat are in deep trouble.
This is all a “tax base” issue as well. Fewer workers = less sales tax so the “trickle-down” effect is going to be brutal. Management companies that owe massive mortgages on these are NOT going to make the tax payments and they face certain bankruptcy because cities still assign massive values to the properties despite no occupancy/tenants.
In many places you have progressive city councils demanding that these commercial buildings be made into apartment buildings.