22 November 2023
The commercial real estate market is experiencing a significant downturn, especially in the office sector where vacancy rates have surged. Experts predict up to 1 billion square feet of unused office space by decade’s end. The current vacancy rate is close to historical highs. With higher interest rates reducing property appeal and causing asset value declines, the market’s recovery appears to be years away. This slump extends beyond offices to sectors like hotels and shopping centers, compounded by rising commercial mortgage delinquencies. The situation is part of a broader economic downturn, with a recession and stock market declines expected. The commercial real estate correction is just beginning, signaling more difficulties ahead.