Stress Builds as Office Building Owners and Lenders Haggle Over Debt
The New York Times reported that the nation's economy could hinge on high-stakes negotiations over commercial real estate loans. Landlords need to refinance about $137 billion of office mortgages this year and nearly half a trillion dollars in the following four years, according to Trepp, a commercial real estate data firm. “What we are seeing is this dance between lenders and owners,” said Joshua Zegen of Madison Realty Capital in New York, a firm that specializes in financing for commercial real estate projects. “No one knows what the right value is. No one wants to take a building back,” he said, adding that building owners don’t want to put in new capital, either. He added that the office sector was feeling far more stress than other kinds of commercial real estate like hotels and apartment buildings.