Alain R'bibo’s Post

CRE Markets Poised for Growth in 2024 Distress in the commercial real estate market has bottomed out, and conditions will soon be on the upswing as more investors from the private equity world seize opportunities to jump into the space

The landscape of low interest rates shifted suddenly in mid-2022, leaving today's real estate market facing a variety of complex challenges, both cyclical and structural. Although real estate has typically bounced back from tough times with vigour, the current situation is unlike any other, bringing forth distinct hurdles as well as potential advantages. Our experts are here to guide you through challenges and help you capitalise on the opportunities that arise from these market changes. Andrea Trozzi, Gareth Phillips #WhenItReallyMatters #Restructuring #alixpartners

Difficult to comprehend the numbers in your real estate finance report? KKR Real Estate reported Q4 earnings of $74.5M, analyzing such figures & making accurate future predictions is a common challenge. They posted a net income of $1 per share for the year, yes, another complex jigsaw to decode for many. But this is a critical pillar which, if overlooked, could lead to misplaced investments! Could your current approach intuit these hidden insights from your revenue streams? Reach out to real estate experts who can help make sense of these numbers, drive decisions and safeguard your investments. You'd be surprised to see the difference they can bring to your balance sheets. Never underestimate the power of expert insights in real estate! #RealEstate #HomeschoolAndRealEstate #RealEstateAgent #Houston #Texas #Property #Apartment

In my previous analysis covering True North Commercial Real Estate Investment Trust (TSX:TSX:TNT.UN:CA, OTC:TUERF) ("True North"), I discussed why the market overreacted significantly to True North's situation in terms of its complete cut of distributions, the decline in revenue and net operating income, the decline in FFO and AFFO amid the general weak outlook on office real estate. After reviewing 2024 Q1's financial results for True North, I continue recommending True North with a "Buy" rating to capitalize on this market overreaction. Although I am still optimistic about True North's outlook and business fundamentals, caution is certainly warranted given some risk factors at an elevated level. https://lnkd.in/g-9GbcyR #officerealestate #realestate #investing #canada #economy #truenorth #reit #stockmarket #tsx

Interesting article on CRE. What's your take on the trending situation? With factors such as hybrid/remote work and property prices falling by 21% from their mid-2022 peak, according to Green Street, a CRE analytics firm, are we heading towards a CRE crisis? U.S. Commercial Real Estate Is Headed Toward a Crisis https://hubs.li/Q02Jdx-F0

Commercial real estate evolves, always has and always will, and now we are at an inflection point. Signs of a revival emerge after grappling with challenges in the previous year. While optimism about a soft landing is growing, it's important to recognize that it will require patience and time for the market to adjust to a new normal of a higher 10-year treasury rate, roughly 150 to 250 basis points higher than where it has averaged over the last decade. We should also anticipate further price erosion across lower cap rate assets as the market regains its footing. The full impact of higher interest rates on consumers, which drive 70% of economic activity, is yet to be fully realized, and there's still a lingering risk of a more challenging economic scenario. Although the likelihood of this risk is diminishing, it's essential to be aware of risks when investing and selecting assets that make sense and are also defensive. That is why I see credit as the best trade today due to its downside protection while achieving returns in line with the equity trade. The market will be more transparent by the middle part of this year, especially with the Fed pivoting. Although stability in interest rates is crucial for values to stabilize further, property owners must contemplate their options, considering that trillions of dollars of property with debt maturing. Pursuing inflection points is a cornerstone of opportunistic investing, reflecting the dynamic nature of commercial real estate and the need to stay agile in response to evolving conditions. Through a continuous assessment of potential inflection points, we position ourselves to make informed decisions, seeking to optimize returns and manage risks in an ever-changing investment landscape. Peachtree Group Peachtree Group Credit Jared Schlosser Michael Bernath Jatin Desai Brian Waldman Michael Harper Daniel Siegel Natalie Wong Bloomberg #commercialmortgage #distresseddebt #hotels #multifamily #cre #privatecredit https://lnkd.in/gjnyGuPE

"It's essential to be aware of risks when investing and selecting assets that make sense and are also defensive. That is why I see credit as the best trade today due to its downside protection while achieving returns in line with the equity trade." -- Peachtree Group CEO Greg Friedman. Are you following Greg's LinkedIn? He frequently posts his thoughts on articles like the one below by Natalie Wong for Bloomberg #Thoughtleadership #privatecredit #commercialrealestate #interestrates

While buyers see "exceptional bargains" in distressed CRE, for office space, the bargain depends totally on future demand. Current actual and forecast negative absorption can easily transform today's bargains to tomorrow's rolling disaster. See three important charts in COMMENT BOXES below. “Compared with the Savings & Loans crisis and 2008, we’re still in the first or second innings” when it comes to troubled assets, said Rebel Cole, the noted finance professor at Florida Atlantic University who also advises Oaktree Capital Management. “There’s a tsunami coming and the waters are pulling out from the beach.” Lenders are pulling away from commercial real estate after borrowing costs rose and values plunged. Asset manager PGIM estimates a gap of almost $150 billion between the volume of loans coming due and new credit availability this year. The biggest withdrawal is for office assets, the total crap shoot in CRE. Blend-and-pretend initiatives on office rollovers over the last year have people scratching their heads. Clearly, the Fed or the U.S Treasury have been quietly promoting this approach. While it is protecting banks from runs on their depositors' cash, it's only going to make the bubble burst bigger when it happens. We should call this "Quiet Pretending," using workplace terminology. And recent Fed pronouncements no longer project rate cuts. There will be no soft landing here. In Europe, the situation is not much better with the amount of CRE debt with a loan-to-value ratio of more than 100% nears €160 billion ($173 billion). Remember when $173 Billion used to be a big number? Nevertheless, there are real investment opportunities in non-office CRE segments as well as creative adaptive reuse transformation projects that move the industry in a new direction.

How do you feel about commercial real estate investments in 2024? #commercialrealestate #commercialinvesting #commercialrealestatebrokerage

Happy to share our latest article featured on Family Wealth Report discussing the current state of private real estate and the potential opportunities available. Check out the article here: https://lnkd.in/dEtCx3dV. #realestate #investmentopportunities #alternativeinvestments #institutionalinvestors #privatewealthmanagement