Nearly 20% of outstanding debt comes from U.S. commercial and
The volume of loans due was up 40% from an earlier estimate of $659 billion by the Mortgage Bankers Association, a surge attributed to loan extensions and other delays rather than new deals.
As the Federal Reserve sends a signal
“Volatility and uncertainty about interest rates, a lack of clarity on property values and issues with some property fundamentals have inhibited sales and financing transactions,” Woodwell said in a statement on Monday. “This year’s expiration date, plus These and other areas should begin to break the deadlock in the market.”
About $4.7 trillion in debt from various sources is backed by U.S. commercial real estate, raising concerns among regulators and investors as construction values slide.Rising defaults and write-downs hit lenders
An estimated $85.8 billion in commercial real estate debt was considered distressed by the end of 2023, according to the MSCI Real Assets Report, which noted that there was an additional $234.6 billion in potential distressed debt.
Green Street data in January showed commercial real estate prices were down 21% from their peak in early 2022 before the Federal Reserve sharply raised interest rates to combat inflation. According to Green Street data, office prices have fallen the most, down 35%. Real Estate Analysis Company.
Mortgage Bankers Group reported that the bank has $441 billion in commercial real estate debt coming due this year. About $234 billion of that maturing debt is securitized in the form of CMBS, collateralized loan obligations and asset-backed securities, while $168 billion of non-bank loans will mature. Lenders, such as debt funds.
About 25% of office loans will mature in 2024, MBA said. As remote and hybrid work grows, values plummet and vacancies surge.