Part 7/12:
The Crumbling Commercial Real Estate Sector
Adding fuel to the fire is the problematic commercial real estate (CRE) market. Loan delinquencies on office buildings have soared to 11.1%, their highest since the 2008 financial crisis. Office vacancies have increased because of remote work trends, and rising refinancing costs have caused defaults. Many properties that sold just over a decade ago are now worth 70%-90% less, when adjusted for inflation—a catastrophic devaluation that signals profound distress in real estate markets.