Commercial real estate prices are in the midst of one of the biggest drops in the past half-century, the IMF said.
AdvertisementUS commercial real estate prices are enduring one of the sharpest drop-offs in the last half-century, easily topping losses seen in previous rate-hike cycles, the International Monetary Fund said.
Since the Federal Reserve's first interest rate hike in March 2022, US commercial property prices have slumped by over 11%, the agency outlined in a blog post.
"Some of the earlier rate hikes, though, such as in 2004-06, were subsequently followed by a recession during which commercial property prices recorded notable declines as demand fell."
In one worst-case scenario, that could as much as $1 trillion in commercial real estate equity, according to Cantor Fitzgerald CEO Howard Lutnick.
Persons:
—, Andrea Deghi, Cantor Fitzgerald, Howard Lutnick
Organizations:
Service, International Monetary Fund, Federal, International Monetary, IMF