VTI - Commercial Real Estate: From Bad To Worse

2024-06-25 11:56:14 ET

Summary

• Much of the commercial real estate sector continues to deteriorate, with rising delinquency rates on debt and falling property values.
• This trend is likely to get worse before it gets better and could have significant impacts on regional and community banks.
• The worsening trends around commercial real estate and their potential impacts on the economy are highlighted in the paragraphs below.

Today, we peak back in on the happenings within the commercial real estate, or CRE, sector, as it appears things are going from bad to worse. And as this part of the economy continues to deteriorate, it will have greater impacts on banks, particularly the regional banking system. This, in turn, could become a larger headwind for the overall economy....

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