US to suffer big setbacks in real estate
By HENG WEILI in New York | China Daily | Updated: 2023-04-28 06:56
Riskiest metro area
The US' largest city, New York, faces the most trouble over CRE, according to myelisting.com, a website that covers the CRE industry.
"New York is the riskiest metro area in the nation for office property valuations, where there are a whopping $16 billion in CRE loans coming due in 2023, a 30 percent increase from 2022," it said.
In Los Angeles, the industrial sector saw a 7.2 percent year-on-year rent gain last year.
However, vacancy rates in the LA office market have increased substantially, and property values have fallen. The city has about $16.9 billion in outstanding office loans, and ranks 14th in the US for office-loan risk.
The International Monetary Fund's recent financial stability report warned how a mix of declining property values, tighter financial conditions and illiquid markets could devastate borrowers looking to refinance loans, leading to sharply higher default rates.
Agencies contributed to this story.