https://www.wsj.com/articles/commercial ... s-e0c1f2b3
https://www.ft.com/content/705df695-c81 ... a6e9cd7500
US banks are becoming increasingly worried about falling commercial property valuations and the risk they pose to lenders’ balance sheets, senior executives said this week.
Office valuations in particular have been pummelled by rising interest rates and many employees’ preference for working from home since the coronavirus pandemic.
However, financial executives sought to reassure investors that they did not foresee significant systemic risk because holdings are broadly distributed among banks and other institutions.
“What happens with commercial real estate, particularly offices” was State Street’s biggest concern, the US custody bank’s chief executive Ron O’Hanley said this week. Not all properties had been hit equally, he added: “Class A is holding up. Rents may be declining but they are not in trouble. Class B and C absolutely are.”
“The question we all have is whether contagion will spread from the office sector,” said Bryan McDonnell, head of PGIM’s real estate debt business, which has $122bn under management. “If you get to a confidence issue then, all of a sudden, people might put all commercial real estate in the same bucket.”
There are signs of the rising stresses in first-quarter bank earnings. Last week Wells Fargo reported that its non-performing commercial real estate loans had jumped nearly 50 per cent since December to $1.5bn. Morgan Stanley cited commercial property and a deteriorating economic outlook as reasons for a sharp rise in its provisioning compared with last year.
“In my view we are not in a banking crisis, but we have had, and may still have, a crisis among some banks,” chief executive James Gorman told analysts on a call.
Commercial real estate loans account for about 40 per cent of smaller banks’ total lending, against about 13 per cent of the books of the biggest lenders.
Arkansas-headquartered Bank OZK, which is heavily exposed to the sector, reported on Friday that it had raised loan provisions by 10 per cent in the first quarter. At $36mn, that marked a tenfold increase over the levels of a year ago.
商业地产警钟再起
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Narcotics07
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Re: 商业地产警钟再起
现在的问题是office ，高档的没问题，中低档的过剩了，
加上WFH，需求减少了，如果vacancy过高office的作价
也会有问题，价值低了rent少了，两面夹击还要refin
高利息，问题就严重了
加上WFH，需求减少了，如果vacancy过高office的作价
也会有问题，价值低了rent少了，两面夹击还要refin
高利息，问题就严重了
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changjiang
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Narcotics07
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