Search
 

The Decline Has Begun In Some Property Types

The top is passed

By Joel Ross | joelross | Updated on March 27, 2016

joel-ross

What began as only a couple of us warning that the top was being reached, has now become a series of articles confirming that we are there. Hotels are already in a 10% value decline, and other property types are flat or about to be. As always it is all about the debt markets. Now that CMBS markets are grinding down to very limited capacity, and the Feds have put the squeeze on the banks to reduce leverage levels on commercial property loans, values have begun to flatten or decline as the returns due to lower or no leverage decline. It is always about the capital markets and currency markets.  If debt is limited and more expensive, and if offshore investors can’t buy things at a discount in their currency, then it is impossible to maintain high values.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.