Problems

Problems

June 5, 2025
Don Catalano
AI office

The AI Bloodbath is Here…And It’s Taking the Office Market With It

The Collapse of Entry-Level White Collar Jobs Could Wreck the Office Market There’s no soft landing here. The numbers are out—and they’re grim. The World Economic Forum predicts that 83 million jobs will vanish globally by 2027 due to AI. Goldman Sachs takes it a step further: 300 million jobs at risk worldwide, with 10 […]
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vacancy tax san francisco

Will a Vacancy Tax on Commercial Properties Save Downtowns? Probably Not.

Commercial Landlords Are Down—Now California Wants to Finish the Job. California’s Senate Bill 789 is a vacancy tax pitched as a cure for downtown decay. But tenants should ask: what happens when you tax the landlords out of existence? The proposed bill would slap a $5-per-square-foot annual tax on commercial properties vacant for 182+ days, […]
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How To Identify Distressed Office Properties

With high vacancy rates, an increasing number of landlord defaults, and an oversupply of office space, the landscape is ripe for corporate tenants to secure prime properties at a fraction of the price. This environment presents both challenges and opportunities—especially for those who know how to spot distressed properties and leverage the current market conditions […]
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CMBS Special Servicing Rates Spike: Navigating CMBS Loan Distress

The CMBS special servicing rate—a key indicator of loan distress—has jumped for the ninth consecutive month. And if you’re a tenant, CFO, or director of real estate, it’s time to pay attention. This isn’t just another statistic. It’s a signal that more properties are falling into financial trouble, and that could have serious consequences for […]
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Dock Worker Strike Delayed, Not Averted: How a January Walkout Could Disrupt CRE

The temporary suspension of the dock workers’ strike by the International Longshoremen’s Association (ILA) might give shipping companies and businesses along the East and Gulf Coast ports some breathing room, but the risk of a full-scale work stoppage in January remains real. Should the ILA and the United States Maritime Alliance fail to reach a […]
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7 Cities With the Most Distressed Commercial Mortgage-Backed Securities CMBS Loans

In this article, you’ll learn: Where distress of commercial properties is concentrated Why commercial mortgage-backed security loans are troubled The impact of CMBS loan distress on commercial properties and tenants From soaring vacancy rates to rising interest payments and increasing operational costs, the complexities of commercial real estate loans are reshaping the future of office […]
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Tenants Beware: Commercial Real Estate Debt & Distress Climbs

In this article, you’ll learn: The current state of commercial real estate debt, reaching $94.2 billion in distress in Q2 of 2024. The effects of rising interest rates and lower office demand on property values. Landlords selling properties at deep discounts due to reduced occupancy and revenue. Increasing foreclosure risks and defaults among commercial landlords […]
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Office Market Faces Rising Defaults and Delinquencies Amid Maturing Loans

In this article, you’ll learn: The office market is facing increasing defaults and delinquencies due to maturing loans and declining values. Billions in office loans maturing by 2026 heighten default risks, especially in cities like Atlanta and Denver. Rising interest rates and changing work habits are prompting property value reassessments. Major defaults by landlords like […]
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What Cities Have More Concentrated Default Risk? Measuring DSCR’s

In this article, you’ll learn: How Debt Service Coverage Ratio (DSCR) measures landlord financial stability and default risk. The impact of low DSCR on property maintenance and lease security. Risks associated with cross-collateralization of properties. Cities with the highest default risks due to low DSCR, such as Brooklyn and Chicago. Tips for tenants to protect […]
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