“The commercial real estate market is heading for a crisis worse than 2008”

Silicon Valley Bank, the 16th largest bank in the USA (SVB) crisis that started, While swaying in Europe by Swiss Credit Suisse and selling it to UBS; in international markets now commercial real estate markets (Commercial real estate – CRE) There was talk of shooting.
One of those who made the warning was Hafize Gaye Erkan, the writer of DÜNYA Newspaper, who said in her column yesterday, "Credit shrinkage will especially affect the commercial real estate markets".. While global experts are making repeated statements in this direction,; Perhaps the harshest warning came from analysts of the American investment bank Morgan Stanley.. CRE market according to MS analysts, 2008 will be worse affected by the global banking crisis.

Offices 'COVID' victims!

As remote work has become more common since the beginning of the pandemic,, Commercial real estate in the USA was also affected by the 'COVID'...

USA Today, the nation's largest circulation newspaper, drew attention to the period between the onset of the pandemic and the bankruptcy of banks: “Long before the collapse of the two banks in March, sector, Decreased demand due to remote working, It was grappling with various issues such as rising costs and interest rates.” MS analyst Lisa Shalett summed up the industry's problem in her latest report:: "The biggest problem, 2.9 More than half of the trillion-dollar commercial mortgage will be refinanced in the next few years..

Even if current rates stay where they are, new lending rates, percent from many of CRE's existing mortgages 3.5 ila 4.5 score is likely to be higher.” The common view of MS analysts is as follows:: “Considering that 80 percent of commercial real estate loans are composed of small and medium-sized banks,, the situation may get worse soon.

Commercial real estate prices, 2008 percent to compete with the decline during the financial crisis. 40 can fall as low. Such challenges are not just for the real estate industry., It can harm all business circles related to it.”

“will fall in half”

So what do market representatives say?? Mark Grinis, Sales Manager, EY Americas, talks about the industry's problem: “If you look at our data centers or industrial buildings that power e-commerce, they are in pretty good shape. If you enter a multi-family company, Rents may soften a bit., however, housing supply is still insufficient.

When it comes to office loans, 2021percent by volume since 44 defaulted more and the percentage 55 was in more special service. So storm clouds are coming. in the short term, poorly structured, capitalized and funded buildings will likely either undergo some form of ownership change or go through foreclosure.”

5 Kip Sowden, CEO of Dallas-based RREAF Holdings, which manages billions of dollars in assets, also pointed out that the industry is shrinking due to "tighter lending requirements".: “In 2022, our company, 2021in the 1.3 billion-dollar transaction volume. 1.5 over a billion dollars. 2023I missed you, We think these numbers will likely be halved due to higher interest rates and a reduction in the number of deals financial institutions will seek to fund.”

what is the solution? The first thing that comes to mind of US experts, turning offices into homes. That's why New York, In cities such as San Francisco and Los Angeles, meetings have already begun to be held with local governments on legislative changes…



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