DIRS.INFO The most relevant business & tech news

July 14 (Reuters) - Wells Fargo (WFC.N) raised its annual forecast for net interest income (NII) after its profit surged 57% in the second quarter, sending shares up 4% in premarket trading. NII climbed 29% to $13.16 billion, benefiting from higher interest rates as Wells Fargo and other banks raised their borrowing costs following a series of rate hikes by the Federal Reserve to tame inflation. Wells Fargo reported profit of $1.25 per share for the three months ended June 30, beating analysts' average estimate of $1.16 per share, according to Refinitiv data. REAL ESTATE WOESThe provision for credit losses included a $949 million increase in the allowance for potential losses in commercial real estate (CRE) office loans, as well as for higher credit card loan balances. Wells Fargo is still operating under an asset cap that prevents it from growing until regulators deem that it has fixed problems from a fake accounts scandal.

Persons: Wells, NII, Charlie Scharf, CRE, Michael Santomassimo, Wells Fargo, Scharf, JPMorgan Chase, Noor Zainab Hussain, Manya, Saeed Azhar, Lananh Nguyen, Arun Koyyur Organizations: Federal Reserve, U.S, Wells, JPMorgan, First, Bank, Manya Saini, Thomson Locations: U.S, Wells Fargo, Bengaluru, New York

☆ JPMorgan, Wells Fargo prepare for losses on office loans
▼ + stars: | 2023-07-14 | by ( Matt Tracy | ) www.reuters.com time to read: +3 min

July 14 (Reuters) - JPMorgan Chase (JPM.N) and Wells Fargo (WFC.N) said on Friday they set aside more money for expected losses from commercial real estate loans, in the latest sign that stress is building up in the sector. Wells Fargo reported higher losses in CRE due to its office loan portfolio. "While we haven't seen significant losses in our office portfolio to-date, we are reserving for the weakness that we expect to play out in the market over time," Wells Fargo CEO Charlie Scharf said. The bank, which acquired First Republic Bank in May, reported $1.1 billion in credit loss provisions driven by its office portfolio. Some $20 billion of office commercial mortgage-backed securities, which bundle together individual loans, mature in 2023, according to real estate data provider Trepp.

Persons: JPMorgan Chase, Wells, Wells Fargo, Charlie Scharf, Jeremy Barnum, Matt Tracy, Michelle Price, Lananh Nguyen, Nick Zieminski Organizations: JPMorgan, Republic Bank, U.S, Federal, Regulators, McKinsey Global Institute, McKinsey, Thomson Locations: Wells, CRE, U.S

☆ U.S. banks point to resilient but slowing economy, flag risks ahead
▼ + stars: | 2023-07-14 | by ( ) www.reuters.com time to read: +3 min

U.S. consumers still have a healthy balance sheet, the banks said, but warned spending was slowing and there had been a modest deterioration in some consumer debt. "The U.S. economy continues to be resilient," JPMorgan Chief Executive Jamie Dimon said. Investors have worried that high interest rates could push the economy into a recession, but the outlook remains uncertain. Wells CEO Charlie Scharf said the range of scenarios for the economy should narrow over the next few quarters. For now, the economy is performing better than many expected but will likely continue slowing.

Persons: JPMorgan Chase, Wells Fargo WFC.N, Wells, Jamie Dimon, Jeremy Barnum, Charlie Scharf, Larry Fink, Wells Fargo, Scharf, Morgan Stanley, Goldman Sachs, Niket Nishant, Noor Zainab Hussain, Mehnaz Yasmin, Manya, Nupur Anand, Saeed Azhar, Megan Davies, Paritosh Bansal, Nick Zieminski Organizations: JPMorgan, Citigroup, Citi, Federal Reserve, CNBC, Wells, Bank of America, Manya Saini, Thomson Locations: Wells, U.S, Bengaluru, New York

☆ A look at the state of US bank credit as earnings season begins
▼ + stars: | 2023-07-14 | by ( Safiyah Riddle | ) www.reuters.com time to read: +5 min

Bank credit growth began slowing in the second half of last year and has slowed further since the SVB failure, although that deceleration has not been uniform. Meanwhile, here's a look at the current state of the bank credit scene, according to data published each week by the Fed. Reuters Graphics Reuters GraphicsCONSUMER CREDITThe Fed splits this category into three tranches: credit cards, auto loans and all other consumer loans. Bank credit card lending is the largest of the three at nearly $1 trillion, a record. Both CRE and residential real estate loans are still rising year over year, but at a much slower pace.

Persons: Banks, Safiyah Riddle, Dan Burns, Anna Driver Organizations: Silicon Valley Bank, Federal, Fed, Securities, Reuters, Reuters Graphics Reuters, Bank, Thomson Locations: U.S, Silicon, Bank

In recent weeks, banks have stepped up efforts to prevent such losses, according to commercial real estate (CRE) analysts and industry data. The 23 largest U.S. banks held 20% of office and downtown retail CRE loans, according to the U.S. Federal Reserve. Small banks also have high exposure to CRE loans as a percentage of their assets. About $2.1 billion of office loans pooled in CMBS matured in May, almost double the total amount from January through April, for example. If borrowers agreed to loan extensions, some $10.8 billion of office loans maturing this year would be pushed to later years, Moody's said.

Persons: Shaishav Agarwal, Agarwal, Steve Jellinek, Moody's, Kevin Fagan, Fagan, ” Fagan, Eliasaf, ”, Banks, Shankar Ramakrishnan, Matt Tracy, Paritosh Bansal, Nick Zieminski Organizations: U.S, Deutsche Bank, U.S . Federal, Manhattan, Northwind, Thomson Locations: York

REUTERS/Kevin Lamarque/File PhotoNEW YORK, July 11 (Reuters) - Wall Street banks are expected to report higher profits for the second quarter as rising interest payments offset a downturn in dealmaking. Results for investment banking behemoths will also weaken, with EPS forecast to drop almost 59% at Goldman Sachs (GS.N). That offsets the doldrums in investment banking, where revenues have been depressed by rising interest rates and economic uncertainty. Reuters GraphicsBanking executives have also lowered expectations for the second quarter after mergers, acquisitions and debt offerings plunged in recent months. "We see higher credit risk ahead for lower to middle class families with higher credit card debt that cannot keep pace with higher living costs," Leon added.

Persons: Kevin Lamarque, Goldman Sachs, Morgan Stanley's, David Konrad, Keefe, Goldman, Stephen Biggar, Wells, Morgan Stanley, Betsy Graseck, Kenneth Leon, Leon, Konrad, Nupur Anand, Saeed Azhar, Niket, Lananh Nguyen, Marguerita Choy, Andrea Ricci Organizations: Bank of America, REUTERS, JPMorgan, . Bank of America's, Citigroup, Universal, Argus Research, JPMorgan Chase, Reuters Graphics Banking, Federal Reserve, CFRA Research, Investors, Thomson Locations: Washington, Wells, Refinitiv, Wells Fargo, U.S, New York, Bengaluru

☆ Factbox: Five things to watch out for in US bank earnings
▼ + stars: | 2023-07-11 | by ( ) www.reuters.com time to read: +3 min

An S&P index of U.S. bank stocks has fallen more than 9% this year as investors fret about the effect of high interest rates and a looming downturn. Here are five trends to watch this season:COMMERCIAL REAL ESTATE (CRE)Investors will scrutinize disclosures on banks' CRE exposure, particularly on office loans. CRE has come under pressure from rising interest rates and the proliferation of remote working that emptied out many office buildings. Big U.S. banks' CRE portfolios put in a surprisingly good performance during the Federal Reserve's annual health checks, with losses declining slightly versus last year, the central bank said last month. To lure customers, banks will face pressure to pay higher rates on deposits, which would erode their profits, analysts have said.

Persons: Morgan Stanley, Mike Segar, CRE, Goldman Sachs, Niket, Lananh Nguyen Organizations: REUTERS, Federal, Thomson Locations: Manhattan, New York City, Big U.S, Bengaluru

☆ Can AI save commercial real estate in San Francisco?
▼ + stars: | 2023-07-10 | by ( Samantha Delouya | ) edition.cnn.com time to read: +7 min

In an aerial view, cars drive by the San Francisco skyline as they cross the San Francisco-Oakland Bay Bridge on October 27, 2022 in San Francisco, California. Alexander Quinn, senior director of research at commercial real estate company JLL, said his firm sees bright spots in San Francisco’s commercial real estate market as AI companies drive office leasing demand. A shopper exits the Westfield San Francisco Centre shopping mall in San Francisco, California, US, on Tuesday, June 13, 2023. The US Census Bureau reports an estimated 35% of employees in San Francisco and San Jose continue to work from home. “I think the crash is coming, and it hasn’t happened yet,” he added, referring to commercial real estate prices.

Persons: Naveen Rao, CBRE, Justin Sullivan, it’s, ” Rao, San, Alexander Quinn, JLL, ” Quinn, Rao, OpenAI, ”, “ There’s, MosaicML, Quinn, “, Francisco’s, David Paul Morris, Henrique Dubugras, ” Michael Tannenbaum, Tannenbaum, Hans Hansson Organizations: CNN, San, Westfield, San Francisco Centre, Westfield San Francisco, Bloomberg, Getty, London, US, “ Locations: San Francisco, Southern California, Francisco, Oakland, San Francisco , California, ”, “ San Francisco, New York, Los Angeles, city’s, San Francisco’s Union, Coresight, Westfield San Francisco Centre, California, Francisco’s, San Jose, decamping, United States

☆ The Fed's own economists don't know if the US will escape a recession or not. They say it's basically a coin toss.
▼ + stars: | 2023-07-06 | by ( Theron Mohamed | ) www.businessinsider.com time to read: +3 min

The Fed's own economists aren't sure if the US economy will suffer a recession or not. They believe it's a virtual coin toss whether there's a mild downturn or none at all. Even the Federal Reserve's own economists say it's basically a coin toss, the minutes from the Fed's June meeting show. The central bank's staff predicted that banks would keep pulling back on lending, tightening financial conditions and causing real gross domestic product (GDP) to decline modestly for the next two quarters. They also tend to damp demand, lift unemployment, and pull down asset prices, increasing the risk of a recession.

Persons: —, it's, Jerome Powell Organizations: Service, Silicon Valley Bank, Signature Bank, Fed Locations: Silicon

☆ US commercial real estate probably won't recover from crisis until 2040, thanks to out-of-fashion office buildings, economist says
▼ + stars: | 2023-07-05 | by ( Zahra Tayeb | ) www.businessinsider.com time to read: +3 min

US commercial real-estate values aren't likely to recover until 2040, according to Capital Economics' deputy chief property economist. Kiran Raichura said office values are unlikely to rebound to their peaks until 2040 thanks to the strengthening work-from-home trend, and high interest rates. The commercial real estate (CRE) industry has been under stress since the US regional-banking sector faced a bout of turmoil earlier this year. Columbia Business School professor Stijn Van Nieuwerburgh recently warned that the pain is just beginning for commercial real estate – and tumbling prices could fire up the banking crisis again and hurt the US economy. Furthermore, rising distressed commercial real-estate assets is adding to concerns a crisis may be brewing in the sector.

Persons: we've, Kiran Raichura, —, Raichura, Stijn Van Nieuwerburgh Organizations: Capital Economics, Service, Columbia Business School

☆ The pain is just starting for commercial real estate - and plunging prices could reignite the banking crisis and choke the US economy, Columbia professor says
▼ + stars: | 2023-07-04 | by ( Theron Mohamed | ) www.businessinsider.com time to read: +3 min

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

☆ Here are Thursday's biggest analyst calls: Nvidia, Micron, Netflix, Amazon, Disney, TJX, Pfizer and more
▼ + stars: | 2023-06-29 | by ( Michael Bloom | ) www.cnbc.com time to read: +5 min

Goldman Sachs reiterates Micron as buy Goldman said it's standing by its buy rating on the chipmaker after its earnings report Wednesday. JPMorgan reiterates Amazon as overweight JPMorgan said it's bullish heading into Amazon Prime Day in July. Bank of America reiterates Nvidia as buy Bank of America said it sees "AI networking upside" after a meeting with company management. Piper Sandler initiates TJX Companies as overweight Piper said the discount retailer is a top idea for the second half. Deutsche Bank reiterates Pentair as buy Deutsche Bank said Pentair is more than just a pool company.

Persons: Morgan Stanley, Freyr, Goldman Sachs, Goldman, China —, it's, Collette Kress, Networking Gilad Shainer, NVDA, OSK, Piper Sandler, Piper, KeyBanc, Pentair, Oppenheimer Organizations: Micron, Cyberspace Administration, JPMorgan, Amazon, " Bank of America, Nvidia, Bank of America, Networking, TAM, JPMorgan downgrades, Citizens, 2Q, Citi, Netflix Citi, Netflix, UBS, Warner Music, Deutsche Bank, Oshkosh Deutsche Bank, TJX Companies, DIS, Suisse, Pfizer, Credit Suisse, pharma, Spotify, FV Locations: China, 3Q22

☆ Blackstone's Nadeem Meghji: Can't paint CRE space with a broad brush due to big bifurcation
▼ + stars: | 2023-06-29 | by ( ) www.cnbc.com time to read: 1 min

Share Share Article via Facebook Share Article via Twitter Share Article via LinkedIn Share Article via EmailBlackstone's Nadeem Meghji: Can't paint CRE space with a broad brush due to big bifurcationNadeem Meghji, Blackstone's head of real estate for the Americas, joins 'Squawk on the Street' to discuss the current commercial real estate space, whether in-office challenges have made them reconsider their exposure, and more.

Persons: Blackstone's Nadeem Meghji, Meghji

☆ Factbox: Big banks stand strong against Fed's commercial real estate gloom
▼ + stars: | 2023-06-28 | by ( Michelle Price | ) www.reuters.com time to read: +3 min

WASHINGTON, June 28 (Reuters) - Big U.S. banks' commercial real estate portfolios put in a surprisingly good performance during the Federal Reserve's annual health checks, with losses declining slightly on last year, the central bank said on Wednesday. With risks growing in the commercial real estate (CRE) sector globally, analysts and investors were looking to the Fed's "stress tests" for more insight on how exposed the country's lenders are to falling real estate prices. Commercial real estate (CRE), especially offices, has been hit by interest rates hikes and workers choosing to stay at home. The Fed's annual bank "stress tests" established following the 2007-2009 financial crisis probe how lenders would fare against an extreme scenario: a 40% decline in commercial real estate values. The average projected CRE loan loss rate across the group was 8.8% of average loan balances, compared with 9.8% last year, the Fed said.

Persons: Goldman Sachs, Morgan Stanley, Charles Schwab, Michelle Price, Pete Schroeder, Stephen Coates Organizations: Federal, Moody's Investors Service, Bank of America Corporation, of New York Mellon Corporation, Barclays US, BMO Financial Corp, Financial Corporation, Charles, Charles Schwab Corporation, Citigroup Inc, Financial Group, Inc, Suisse Holdings, DB USA Corporation, Goldman, Goldman Sachs Group, JPMorgan Chase & Co, T Bank Corporation, Northern Trust Corporation, PNC Financial Services Group, RBC US Group Holdings, Street Corporation, US Holdings, Truist Financial Corporation, UBS, Holding, . Bancorp, & Company, Thomson Locations: Big U.S

☆ Here are Friday's biggest analyst calls: Meta, Apple, Uber, Target, SoFi, Nike, Amazon, GM and more
▼ + stars: | 2023-06-23 | by ( Michael Bloom | ) www.cnbc.com time to read: +6 min

Here are Friday's biggest calls on Wall Street: Morgan Stanley reiterates Apple as overweight Morgan Stanley said in a note Friday that it sees several reasons for share outperformance. Morgan Stanley upgrades Evotech to overweight from equal weight Morgan Stanley said the drug discovery and development company is well-positioned for artificial intelligence. As such we are upgrading to Market Perform with a $44 price target." Morgan Stanley reiterates Snowflake as overweight Morgan Stanley said it's bullish heading into the company's upcoming investor day. Barclays reiterates Uber as overweight Barclays raised its price target on Uber to $70 per share from $57 and says it's well-positioned.

Persons: Morgan Stanley, Apple, Stephens, KeyBanc, Wells, Armour, Wells Fargo, JPMorgan Chase, Valvoline, underperform SVB, Wayfair, Snowflake, it's, Uber, Roth, Bernstein, Jefferies Organizations: Deutsche Bank, Nike, Sovos Brands, UAA, Outsized NA, JPMorgan, Global Products, Securities, Bed, Barclays, Amazon, Citi, General Motors Locations: China, Italian, downgrades, EBITDA

☆ As regional bank stock rally regains steam, investors should watch out for these spoilers
▼ + stars: | 2023-06-13 | by ( Christina Cheddar Berk | ) www.cnbc.com time to read: +6 min

With the Federal Reserve expected to pause its rate-hiking campaign at this week's meeting, regional banks stocks have made a comeback, but that doesn't mean all the trouble is in the rearview mirror. Still, the upward march resumed on Tuesday, begging the question of what's ahead for bank stocks. As the Treasury sells tens of billions of dollars in Treasury bills, it could pressure bank deposits. Graseck predicts that a reacceleration of deposit outflows would snuff out the bank stock rally. In addition, regional bank earnings estimates, which had been cut severely in March and April, had leveled off in May.

Persons: Jack Ablin, Ablin, outflows, SVB, Aditya Bhave, Bhave, Morgan Stanley, Betsy Graseck, Graseck, Nicholas Colas, Huntington Bancshares, Matt O'Connor, KeyCorp, Albin Organizations: Federal Reserve, Fed, Cresset, Silvergate, Silicon Valley Bank, Signature Bank, PacWest Bancorp, Bank of America, Treasury, DataTrek Research, Citizens Financial Group, Truist, Morgan Stanley U.S, Financials, CRE Conference, Deutsche Bank, TFC Locations: Silicon, Federal, U.S, 2Q23, New York

[1/5] Customers stand next to a counter at a Starbucks' outlet at a market in New Delhi, India, May 30, 2023. Starbucks plans to open more stores in smaller towns, said an industry source, who spoke on condition of anonymity. Soon after Starbucks' May launch of $3.33 milkshakes, designed to attract children, Third Wave launched its own range, a fifth cheaper at $2.71. He saw Starbucks' cheaper, small-sized drinks as a response to competition in "an incredibly price-sensitive market". "Going deeper into smaller cities, beyond the metros, is the only way to grow," said Ankur Bisen, head of retail at India's Technopak Advisors.

Persons: Sushant Dash, Tim Hortons, Devangshu Dutta, We've, chai, Chas Hermann, Sushant Goel, Matt Chitharanjan, Dash, Ankur Bisen, Sriram, Aditya Kalra, Anushree Fadnavis, Varun Vyas, Euan Rocha, Miyoung Kim, Sophie Yu, Hilary Russ, Clarence Fernandez Organizations: REUTERS, MUMBAI, Blue, Starbucks, Tata Group, BET, CHAI, Wave, Third, Reuters, Blue Tokai, India's Technopak, Thomson Locations: New Delhi, India, American, DELHI, U.S, Blue Tokai, China, Singapore, United States, Bengaluru, Delhi, Aurangabad, Beijing, New York

☆ JPMorgan upgrades this regional bank stock with limited exposure to commercial real estate, sees 25% gain
▼ + stars: | 2023-06-05 | by ( Brian Evans | ) www.cnbc.com time to read: +1 min

JPMorgan thinks there's a buying opportunity in regional bank Valley National. The bank upgraded Valley National Bancorp to overweight from neutral Monday with a $10 per share price target. Analyst Steven Alexopoulos noted that Valley National's exposure to the commercial real estate market is reasonably below peers which could shield the firm from loan headwinds. Valley National shares have tanked more than 29% in 2023. The stock dropped with the broader regional banking space after the collapse of Silicon Valley Bank and Signature Bank earlier this year.

Persons: Steven Alexopoulos, Alexopoulos, —, Michael Bloom Organizations: JPMorgan, Bancorp, Silicon Valley Bank, Signature Bank Locations: Silicon

☆ Here are Monday's biggest analyst calls: Apple, Tesla, Meta, Micron, Bowlero, Nike, Disney and more
▼ + stars: | 2023-06-05 | by ( Michael Bloom | ) www.cnbc.com time to read: +7 min

Oppenheimer reiterates Meta as outperform Oppenheimer raised its price target on the stock to $350 per share from $285 and said it's well-positioned. Deutsche Bank upgrades Rio Tinto to buy from hold Deutsche Bank said shares of the metals and mining company are very attractive. Morgan Stanley reiterates Disney as overweight Morgan Stanley lowered its price target on the stock to $110 from $120 but said it's standing by the shares. " Morgan Stanley downgrades Dollar General to equal weight from overweight Morgan Stanley said in its downgrade of Dollar General that it sees too many risks right now. Morgan Stanley upgrades Equitrans Midstream to overweight from underweight Morgan Stanley said the energy company is better positioned after the debt ceiling raise.

Persons: Tesla, Canaccord, Oppenheimer, it's, TD Cowen, Cowen, Bernstein, it's bullish, Needham, Coinbase, Morgan Stanley, Disney, KeyBanc, Jefferies, Wolfe, Wells, Wells Fargo, Estee Lauder, Morgan Stanley downgrades, Equitrans, Stifel, Brett Parker, JPMorgan Chase Organizations: U.S, Formula, Deutsche Bank, Rio Tinto, Disney, Media, Target, Costco, Jefferies, Oracle, Palo Alto Networks, Alpha, Citi, Micron, Wells Fargo, Nike, Bank of America, Apple, of America, Pipeline, Barclays, Meta, JPMorgan Chase, JPMorgan Locations: China, Rio, Lido, Binance, Palo, SKX

NEW YORK, May 31 (Reuters) - Wells Fargo & Co's (WFC.N) Chief Executive Officer Charlie Scharf said on Wednesday that there will be losses in the office loan space but the lender was proactively managing its portfolio. But in the context of the overall portfolio and the overall size of our loan portfolio with the company, we are not overly concentrated in office (loan space)," Scharf said while speaking to investors at a conference. The bank's outstanding commercial real estate (CRE) loans stood at $154.7 billion, or 16% of total loans, with $35.7 billion in office loans at the end of March. Office loans have posed concerns for some lenders as property values decline and more borrowers default on their loans. The San Francisco-based bank set aside $1.21 billion in the first quarter to cover potential loan losses, compared to $787 million a year earlier.

Persons: Charlie Scharf, " Scharf, Scharf, Banks, We've, Wells Fargo, Nupur Anand, Saeed Azhar, Jason Neely, Nick Zieminski Organizations: YORK, U.S, Regulators, JPMorgan Chase &, Bank of America Corp, Citigroup Inc, Thomson Locations: San Francisco, New York

☆ Blackstone, the massive private-equity firm, just wants to be your friendly, neighborhood lender
▼ + stars: | 2023-05-25 | by ( Dan Defrancesco | ) www.businessinsider.com time to read: +5 min

Your friendly neighborhood lender, BlackstoneWhat's the first thing that pops into your head when you think of a regional bank? Nouriel Roubini, the famed economist known as "Dr. Doom" isn't too optimistic about the future of regional banks. Never one to miss a chance to make money, Blackstone CEO Stephen Schwarzman said his firm can "fill the void" left by regional banks tightening up their lending activity. Regional banks happen to be one of the biggest lenders in commercial real estate. Doom' is feeling bearish on regional banks.

☆ Analysis: Overexposed US regional banks could sell commercial property loans
▼ + stars: | 2023-05-17 | by ( Matt Tracy | ) www.reuters.com time to read: +5 min

Still, previously unreported data from New York-based real estate data provider Trepp, shared with Reuters, show many regional banks' holdings exceed thresholds stipulated by regulators. While big banks have recently warned about CRE exposure, the new Trepp data underscores how acute and widespread the problem is across the banking sector. The regulatory guidance requires that banks exceeding these thresholds "should employ heightened risk management practices," including potential sales of specific loans. Meanwhile, New York Community Bancorp (NYCB.N) and Flagstar Bank [RIC:RIC:FBCANK.UL] were among the top five banks listed by Trepp that exceeded the CRE loan threshold. In Tuesday congressional testimony, FDIC chair Martin Gruenberg warned CRE loan portfolios "face challenges" should market conditions persist.

☆ Commercial real-estate prices could tumble 10% from their peak and defaults are sure to increase, Moody's chief economist says
▼ + stars: | 2023-05-17 | by ( Zahra Tayeb | ) www.businessinsider.com time to read: +2 min

Expect commercial real-estate prices to plunge 10% from their peak, along with a wave of defaults, Moody's chief economist said. "Lots more CRE price declines are coming, with prices expected to be off 10% peak-to-trough by mid-decade," Mark Zandi said. Stress has been building in the commercial property industry as investors fret it could be the domino to fall in the US economy. "Lots more CRE price declines are coming, with prices expected to be off 10% peak-to-trough by mid-decade," he said. "CRE loan delinquencies and defaults are sure to increase, causing agita for the banking system.

☆ Investors would be wise to heed these lessons from the 'retail apocalypse' as office values reset
▼ + stars: | 2023-05-14 | by ( Christina Cheddar Berk | ) www.cnbc.com time to read: +7 min

Still, it is also true that a lot of disruption occurred in between the events that prompted the "apocalypse" chatter and the firmer ground where retail real estate stands today. Recalling how these events played out is helpful in understanding the situation facing U.S. office properties. For office buildings, the pandemic knocked things out of whack. The same idea is being discussed for office buildings, but one-size will not fit all. There may be no surprise that there has been a huge drop-off in the number of loans with office properties as collateral since March.

☆ Private-credit firms see opportunity as banks tighten lending
▼ + stars: | 2023-05-10 | by ( Lisa Pauline Mattackal | ) www.reuters.com time to read: +2 min

May 10 (Reuters) - Private-credit firms are eyeing fresh opportunities from a potential borrowing squeeze in the United States as battered regional banks tighten lending after the turmoil in the sector, according to fund managers and investment strategists. Such lenders see commercial and residential real estate as particularly attractive, given the prominence of regional banks in these sectors. Regional U.S. banks accounted for about 70% of outstanding loans to the commercial real estate (CRE) sector alone, according to Capital Economics. "Signature was one of the biggest providers of real estate lending in the New York area, commercial real estate is very vulnerable ... as a lender you want to be on the other side of that," Handa said. Many private credit funds have plenty of excess funds, or "dry powder" to invest, said Matt Malone, head of investment management at private investment management firm Opto Investments.

Search resuls for: "cre"

25 mentions found