This podcast explains the risks this is creating for CRE owners and banks with loans on these properties. And those risks will impact regional banks most, which are the banks that also mostly serve small and mid-size businesses.
Fed Chair Jerome Powell and Treasury Secretary Janet Yellen have both confirmed we will have a commercial real estate debacle on our hands soon. Great, they finally figured out what Manny and Adam have been saying for over a year! Better late than remaining ignorant! So what does this mean for you?
This podcast explains the risks this is creating for CRE owners and banks with loans on these properties. And those risks will impact regional banks most, which are the banks that also mostly serve small and mid-size businesses. If they lose their reserves, they can’t loan to the small guy. Worse, if those banks fail (like our leaders finally admit is likely) it means real estate prices collapse, bankruptcies – and a lot of empty space on the market at low prices. It means you can plan for lower real estate costs to help you be more successful, and lots of opportunities for conversions into more valuable space (think residential) for offices.
Further, this podcast delves back into the ways demographics feed this very predictable scenario. And how those demographics are affecting all businesses looking to hire for more growth. Future scenarios have to include these remarkable trends toward too much space, and simultaneously too little labor!
Thinking Points: