A Columbia professor has issued a bleak outlook for commercial real estate in the US.
Office values are plunging and threaten to cause an "urban doom loop," Stijn Van Nieuwerburgh said.
If cities become more expensive and less appealing, people are likely to move out, cutting real estate values even more and causing a downward spiral, he said.
Pension funds, real estate investment trusts (REITS), and other entities have invested significant sums in CRE, and the office segment specifically.
"I do worry that there is potential for a spillover here, that we haven't seen the end of the banking crisis yet," Van Nieuwerburgh said.
Persons:
Van Nieuwerburgh, —, Stijn Van Nieuwerburgh
Organizations:
Service, Columbia Business School, Bank, Signature Bank
Locations:
Columbia, CRE, Silicon