Commercial Real Estate On The Decline

Commercial real estate valuations are facing further decline, with CBRE Group Inc. CEO Bob Sulentic predicting an additional 10% drop on top of the initially projected 15-20% decrease.

Why The Decline?

The transition to remote work since the pandemic has had a substantial influence on the industry, resulting to an increase in office vacancy rates in the United States to 18.4%. The drop in property values is due to both lower tenant demand and higher borrowing rates, which have struck commercial real estate more than expected.