Commercial real estate has become a debt timebomb, experts have warned, as office towers remain empty in once-bustling cities.
The new era of remote work means ‘zombie’ workspaces remain vacant - while higher interest rates make it more expensive to buy or refinance buildings.
Some $1.5trillion in real estate mortgages are due this year and next, bringing the market to a dangerous precipice. When the deadline arrives, experts warn owners may be forced to default instead of borrowing again to cover the bill.
Earlier this month, the landlords of downtown San Francisco’s Westfield mall stopped making mortgage payments on its $558million loan amid rising crime and tanking sales.
Meanwhile in New York, building owners are being forced to negotiate extensions on millions of dollars of debt after failing to secure financing.
[snip]
According to building security company Kastle Systems, only about half of office workers in the Big Apple are back at their desks.
And a joint study from researchers at New York University and Columbia University found that offices in the city will lose 44 percent of their pre-pandemic value by 2029 because of the impact of remote work.
Across the country, values for offices have decreased by 27 percent since March 2022, according to data analytics company Green Street.
We’ve had “see-thru’s” for some time now.
I’ve continually noticed the oversupply of commercial real estate.
Nightclubs!! Can you imagine the possibilities?
The result of all this is that commercial real estate is empty. Small businesses don’t renew their leases, and large businesses simply forfeit them. Building owners are walking away from mortgages, leaving their empty office towers to the banks, which cannot possibly find tenants for them. The result is that we are looking at a coming commercial real estate collapse that could make 2008’s home real estate recession look like a cheery block party
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Where is all the pay your mortgage, you deadbeat rhetoric that we saw back in 2008-2009?
These people knew what they were signing.
Let me guess the culprit, which has to be the government.
It was the CCRA.....”Commercial Community Reinvestment Act.”(I made this up)
“The God damn minorities did it again.”(sarcasm)
They will try to kick the can down the road anyway they can. Even try to rezone these into condos or apartments.
Not gonna happen. They will just put illegal aliens and “refugees” in these buildings, at YOUR expense.
In order to actually learn and earn the vast majority of what I know and have, I had to leave home to do it. It was my mom and dad’s home, but the opportunity to learn and earn was what lured me out... So I learned how to design office buildings and earned a living over 40 years doing it.
I’ve humored myself saying “Idiocracy” was a documentary.
Now, looks like Escape from New York is coming true as well.
Why not convert these empty downtown offices into single occupancy, free public housing? Make these cities true liberal Utopia’s where rich guilt ridden white people can make all the tax deductible donations they need to to assuage their guilt. Free housing, food, drugs, booze, 87 genders. Whatevs. Once you “check-in”, you cannot check-out until you prove means of support as there are no hand-outs in Greater America.
Ping.
So that means that around one third of people who commuted to Manhattan from the suburbs before the panic haven't returned.
Absolutely amazing.
I live within 100 yards of a commuter rail station that goes into downtown Boston. Before the panic the station's huge parking lot was full on weekdays. These days it's about half full.
Today it's a "commercial real estate crisis!"
There are a lot of Chicken Little's on this forum.
Who is the chairman in China?
The current president is Xi Jinping, who took office in March 2013, replacing Hu Jintao.
https://en.m.wikipedia.org › wiki
President of the People’s Republic of China - Wikipedia