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Revelation 13:16-18 “Also it causes all, both small and great, both rich and poor, both free and slave, to be marked on the right hand or the forehead, so that no one can buy or sell unless he has the mark, that is, the name of the beast or the number of its name. This calls for wisdom: let the one who has understanding calculate the number of the beast, for it is the number of a man, and his number is 666.”
Important Takeaways:
- The tremors rattling US commercial real estate are spreading to other countries and sectors, and threaten to escalate into a financial earthquake as refinancing deadlines loom.
- Barry Sternlicht, a billionaire real estate investor and Starwood Capital’s CEO, recently predicted $1 trillion of losses on office properties alone.
- More than $900 billion, or 20%-plus of the total debt owed on US commercial and multi-family real estate, will mature this year, Bloomberg reported this week. Borrowers may have no choice but to refinance at much higher interest rates, or sell their properties at a big discount.
- Moreover, the European Central Bank has threatened to impose steeper capital requirements on lenders unless they take commercial real estate risks seriously, sources told Bloomberg.
- At the same time, some Chinese investors are rushing to sell foreign real estate at discounts of 45% or more, in an effort to free up cash as they weather a worsening property crisis at home.
- Fears were reignited this month after New York Community Bancorp abruptly cut its dividend, set aside some $500 million to cover bad debts, and revealed a surprise quarterly loss that it blamed on just two troubled loans.
- Investors promptly sent NYCB stock down 60% in five days, and it’s still trading at two-decade lows.
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