The commercial real estate (CRE) market entered the second quarter of the year with continued rising vacancy rates and slowing rental growth across most market sectors. Specifically, office vacancy rates hit an all-time high, reaching nearly 14%, while fundamentals in the retail and industrial sectors slowed. High interest rates and the impact of hybrid work on office space remain the main factors holding back the sector. Meanwhile, the U.S. economy, which had previously outperformed expectations, has begun to slow, reflecting the impact of inflationary pressures on consumers. Office Property At the beginning of the second quarter of this year, vacant…
Author: Private Lending Agent
Capital Economics predicted commercial real estate could fall another 10% this year. Gary Hirschhorn/Getty ImagesBig financial institutions are investing in commercial real estate more than meets the eye, a survey has found.In addition to lending to real estate owners, major financial institutions also indirectly lend to REITs, and their exposure has increased by about 40%.Wall Street is concerned that high interest rates will cause a decline in commercial real estate.Large financial institutions have greater exposure to commercial real estate debt than commonly thought, suggesting greater potential systemic risk, new research suggests.The paper, titled “The Shadow Always Touches Your Feet: The…
Provided by Hushoffice Share ShareFacebooktwitterPostPinterestWhatsApporhttps://www.archdaily.com/1016978/office-pods-can-respond-to-key-commercial-real-estate-challengesAfter various surveys and polls, many in the office-focused U.S. real estate market (CBRE, JLL, Gallup) agree that managers and operators need to offer flexible, amenity-rich offices to support the modern employee commute. Broadly speaking, we are all being asked to do more with less space, and for many in the office space industry, pods will be part of the solution. Consider the trends that support this idea:First, there's the challenge of return to the office (RTO), which has persisted for years to come post-COVID. Roughly half occupancy rates outline our new normal. One Envoy survey…
Downward angle icon Downward angle icon. Capital Economics estimated that commercial real estate prices could fall another 10% this year. Gary Hirschhorn/Getty Images Big financial institutions are investing more in commercial real estate than meets the eye, a study says. In addition to lending to property owners, they also lend indirectly to REITs, and their investments are up about 40%. Wall Street is concerned that high interest rates will hurt commercial real estate. Large financial institutions have greater exposure to commercial real estate debt than commonly thought, suggesting greater potential systemic risk, new research suggests.The paper, titled “The Shadow Always…
An office building (center) at 1740 Broadway in New York, United States, Sunday, February 11, 2024. Commercial real estate transactions are beginning to pick up in the United States at steep discounts, forcing lenders around the world to brace for bad loans. (Photo by Michael Nagle/Bloomberg via Getty Images) “Overall, the banking system remains healthy and resilient,” Federal Reserve Vice Chairman for Supervision Michael Barr said in congressional testimony on May 15. “The banking industry as a whole needs to be prepared to absorb any loan losses that may materialize and continue to fulfill its vital role of providing credit…
A “For Rent” sign appears in front of a home in Arlington, Virginia, on June 8, 2021. Photo by Will Dunham/Reuters WASHINGTON (AP) — Expectations for a Federal Reserve interest rate cut this year are steadily fading, with a series of recent comments from Fed officials underscoring their intention to keep borrowing costs high as long as necessary to rein in stubbornly high inflation. The main reason for the delay in cutting rates is the lingering effects of the pandemic on inflationary pressures that are plaguing the economy and affecting everything from apartment rents to auto insurance to hospital bills.…
The role of the office has evolved. Its purpose is no longer just a place to work; it is now integral to employee experience, company culture, and organizational identity. This shift in focus has forced HR leaders to become more involved than ever in their companies' real estate decisions. According to a survey by commercial real estate firm CBRE, nearly a quarter (24%) of real estate professionals reported directly to a human resources leader last year, up 14% from the previous year. “Even in companies without a direct line of reporting to a CHRO, we're seeing greater collaboration between HR…
Building owners can consider several approaches to protect their investment and mitigate the rising costs of commercial property insurance. First, you should consider what preventative measures you can take. This includes conducting regular risk assessments, but if you already have one, you can also conduct them more frequently to help inform decision-making and respond to an increase in weather-related events. Commercial property owners can also focus on increasing security and surveillance measures such as cameras, access controls, flood monitoring equipment, and fire prevention tools to better protect their assets. Brokers and advisors can play a key role in helping owners…
Check out our rankings for other top brokerages. Note: The following notable companies did not submit responses: JLL, Eastdil Secured and Avison Young. Key: O=Office, I=Industrial, R=Retail, M=Multifamily, H=Medical, Ho=Hospitality, X=Other To participate in future surveys, please email Agota Felhazi at [email protected]. Interest rates continue to restrict trading Image credit: nortonrsx/iStockphoto.com The pace of investment activity has slowed in 2023, especially compared to the exceptional growth of the previous two years. However, leasing volumes remained uneven across property sectors. Higher capital costs have depressed commercial real estate sales, with office sales expected to reach $33.8 billion in 2023, a sharp…
Dive Overview: According to Conference Board economists, U.S. commercial real estate is likely to face greater disruption this year and next as roughly $1 trillion in debt comes due, hybrid work erodes demand for office space, and interest rates remain higher than expected. “The worst is yet to come, and there are no easy solutions,” Conference Board senior economist Kurt Lyman said of the pressures on commercial real estate during a May 22 webcast. “This is the first time in a generation, or even a once-in-a-lifetime event.” Unusually high levels of commercial real estate debt are coming due as office…