The Great Reset of Property Prices Is Underway. Brace for More.
The global financial crisis that began in 2007 reshaped the real estate market. Today, commercial real estate is facing a similar “Great Reset.”
Peachtree CEO Greg Friedman knows the power of pivoting
Many pivotal moments in Greg Friedman's life occurred against the backdrop of major economic shifts. He graduated college right before the dot-com bubble burst, and coincidentally walked away from an internet company he started at the tail-end of the boom. Just after he founded Peachtree Group, the private equity firm he leads, the Great Recession began, and he and his partners had to shift their business model. Friedman knows firsthand the power of pivoting, which he says helped to lead his firm’s success more than 15 years later. Peachtree Group now counts 250 team members across all of its divisions.
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The global financial crisis that began in 2007 reshaped the real estate market. Today, commercial real estate is facing a similar “Great Reset.” Property valuations are resetting, capital availability is restricted, and investment activity is curtailed. Thanks to stress on properties’ balance sheets, the situation is set to get worse. More than $1.5 trillion of commercial real estate loans will mature over the next three years. Traditional lenders and the securitization market are unlikely to provide a clear path to replacing these loans. Without one, property valuations will reset further and reprice at levels that reflect current economic conditions. Basically, investors need to prepare for further losses. For more market insights from Peachtree Group CEO Greg Friedman, follow him on LinkedIn.
Peachtree's Greg Friedman: Office real estate distress
Peachtree Group CEO Greg Friedman discusses whether there is an imminent commercial real estate disaster on 'The Claman Countdown.'
Peachtree Group CEO Greg Friedman discusses whether there is an imminent commercial real estate disaster on 'The Claman Countdown.'