PIMCO Declares “Storm Is Brewing” in Commercial Real Estate Market

According to a report released recently by Pacific Investment Management Co. (“PIMCO”), U.S. commercial real estate prices may fall as much as 5 percent in the next 12 months due to a tougher regulatory environment, a wall of debt maturities and property sales by publicly traded landlords. However, for flexible capital, the authors of the report say, these dislocations could create attractive investment opportunities, allowing some buyers to pick up properties at bargain prices. Furthermore, when a wave of maturing debt from the previous decade’s boom starts to come due this year, it could open up a window for investors to fund borrowers who come up short.

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