Deja Vu? Today's liquidity and price discovery issues are comparable to the Global Financial Crisis (GFC), with office debt delinquencies reflecting similar patterns. However, the cycles differ fundamentally: in 2008-2009, economic contraction led to cash hoarding, whereas today's 60% drop in deal volume (Q1 2024 vs. 2022 peak) is driven by high interest rates and future uncertainty, unlike the post-GFC zero-interest-rate policy. Despite this, due to strong economic growth, real estate fundamentals remain near historical norms. With inflation easing and the Fed likely done with rate hikes, deal volume is expected to stabilize, potentially picking up in early 2025, though a significant investment boom is unlikely due to slow declines in borrowing costs and cap rates. (CBRE)

Everything’s Fine: A Moody's Ratings report analyzed 41 U.S. commercial banks and found that despite $440 billion in commercial real estate (CRE) loans maturing this year, the banking system remains stable due to conservative underwriting and sufficient tangible common equity (TCE). The report noted that average loan-to-value (LTV) ratios have risen to 66-67%, and while $930 billion in CRE loans are set to mature across all lenders, only 3% of large banks' loans are delinquent. Smaller banks have delinquencies below 1%, and 70% of bank office loans are not paying off at maturity. Despite concerns, the market showed positive lending and transaction volumes in Q1 2024, driven by multifamily, industrial, and non-mall retail deals. (CO)

The New Nightmare: Post-pandemic, many employers are eager to return to the office, but employees are reluctant due to traffic congestion, which costs U.S. workers an average of one work week per year. According to the INRIX Global Traffic Scorecard, traffic delays are increasing in over 75% of U.S. urban areas, costing drivers more than $733 annually and totaling over $70 billion in lost productivity. Public transit ridership is still down 28% from pre-pandemic levels. New York drivers are the most affected, losing 101 hours and over $1,700 annually, while Cumberland, Maryland drivers lose only $22. INRIX suggests that 2023 traffic patterns may represent the new normal. (INRIX)

Now, Wells Fargo thought they'd rake in profits with the Bilt card, but renters are gaming the system. It's like inviting a fox to guard your chicken coop and being surprised when you have fewer chickens. Let’s go!