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re: The actual upcoming real estate crisis. CRE loans and vacant office buildings

Posted on 9/26/23 at 10:19 am to
Posted by Kingpenm3
Xanadu
Member since Aug 2011
8985 posts
Posted on 9/26/23 at 10:19 am to
quote:

Commercial Real Estate (CRE)


Commercial Real Estate has always been a weird space to me. Seems like they are willing to sit vacant for years but still ask crazy high rent prices.

I wonder if this is generally true, but in my industry virtually every office was owned say 30 years ago. Now if you see a business for sale it is shocking if there is any real estate in the offer. Almost everyone is just leasing a spot in a strip mall now.
Posted by Mootsman
Charlotte, NC
Member since Oct 2012
6025 posts
Posted on 9/27/23 at 2:23 pm to
quote:

Commercial Real Estate has always been a weird space to me. Seems like they are willing to sit vacant for years but still ask crazy high rent prices.


It can sit vacant and somewhat retain its value on an as stabilized basis. You start reducing rents your cap rate increases and property loses value.
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