That's according to a recent report by New York-based Moody's Analytics, which also noted office building commercial real estate loans, maturity extensions and potentially even maturity failures could become commonplace amid weak office market performance and interest-rate hikes.
The average vacancy rate nationally in the fourth quarter ticked up to 18.7%, according to Moody's, still short of the record-high 19.7% vacancy observed in 1991 but approaching that figure. The vacancy rate in Q4 also surpassed vacancy rates observed earlier in the pandemic, with the previous pandemic high being 18.5% in Q3 2022 and in Q2 2021, according to Moody's data.
He said it may become difficult for some borrowers to do a loan workout on mortgages for office buildings coming due soon. They may require an equity infusion, especially with office building values declining and interest rates on the rise. Li said the expectation is that tech companies will continue to put space on the market in the coming months and quarters, and other industries will likely begin subleasing their spaces in greater numbers, too, as they face economic uncertainty.
Business Business Latest News, Business Business Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Source: DallasBizNews - 🏆 525. / 51 Read more »
Source: phxbizjournal - 🏆 254. / 63 Read more »
Source: svbizjournal - 🏆 334. / 59 Read more »