Expects more regional bank failures in the US because of a “very high” concentration of troubled commercial real estate loans on their books.
“The real wave of distress is just starting” for lenders to everything from malls to offices, John Murray, Pimco’s head of global private commercial real estate team, said in an interview.
His division sits within Pimco’s $173 billion alternatives business.
The turmoil has been particularly felt among regional banks, which boosted their CRE exposure that in many cases is now worth only a fraction of their value at their peak.
Smaller banks have continued to worry investors ever since the collapse of a few last year.
Earlier this year, US Bancorp, the largest regional bank by assets, increased its provisions for credit losses in the first quarter to $553 million.
Bloomberg 11 June 2024
https://www.bloomberg.com/news/articles/2024-06-11/pimco-warns-of-more-regional-bank-failures-on-commercial-property-pain
Kontorsvakanserna i USA fortsätter upp och ligger nu klart över finanskrisnivåerna
Priserna på kontorsfastigheter har sjunkit med cirka 20 procent på två år och under 2024-2026 ska lån på 1.700 miljarder dollar läggas om.
Enligt centralbankens rapport om finansiell stabilitet från april är kommersiella fastigheter landet fjärde största tillgångsslag efter aktier, statspapper och bostäder.
Marknadsvärdet uppgår till omkring 22.500 miljarder dollar, motsvarande cirka 235.000 miljarder kronor
Det som väcker oro är lånen kopplade till kommersiella fastigheter. Vid årsskiftet uppgick de till 5.900 miljarder dollar. Många gånger handlar det om lån som tagits till låga räntor under åren fram till 2022.
Viktor Munkhammar 11 juni 2024
Commercial Real Estate
Commercial real estate (CRE) is navigating several challenges, ranging from a looming maturity wall requiring much of the sector to refinance at higher interest rates (commonly referred to as “repricing risk”) to a deterioration in overall market fundamentals, including moderating net operating income (NOI), rising vacancies and declining valuations.
This is particularly true for office properties, which face additional headwinds from an increase in hybrid and remote work and troubled downtown
St Louis Fed 30 May 2024
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