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NAI Global’s Olshonsky Sees Coming Wave of Distress
Commercial real estate veteran Jay Olshonsky, NAI Global president & CEO, expects a wave of distressed assets to come to market in the next nine to 18 months. He says it will be comparable to the early 1990s and the Global Financial Crisis of 2008.
“The challenge property owners currently face is the ability to collect rent from existing tenants and attract new tenants to the vacant space in their buildings, especially in the face of collapsing businesses and the rise in bankruptcy filings,” he says.
Over time and without normal rental income, “property owners can lose the ability to make mortgage payments and cover operational expenses,” says Olshonsky. “That becomes the inflection point in which lenders take control of their properties, hire special servicing companies and sell assets under duress.”
The situation is most dire for retail and lodging, but Olshonsky says office is also likely to be affected.
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