We hit the mid-point of ’22 and it’s without question the most interesting, uncertain period that anyone can remember. That includes commercial real estate veterans who endured the double digit interest rates of the early 1980’s and the S&L meltdown a decade later. This time really is different! In this episode, Capital Rivers Commercial President & CEO Greg Aguirre offers his candid assessment, a fair share of gut feeling, and his advice as we head into what will likely be a volatile second half of the year.
Greg says, “As a developer, I believe we are at the tipping point. This happens when the developers’ margins are too tight so projects either don’t pencil at all or it is way too risky for such a tight margin. We are at this point. I know multiple developers that have either recently scrapped their projects or put them on hold. They believe with the interest rate increases and construction costs at all-time highs, the projects simply don’t make sense anymore”.
You can also read our recent Commercial Real Estate Market Reports.
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