Over a trillion dollars in equity wiped out as China, Canada dump commercial property. Who's next?

China and Canada are major sellers of commercial real estate in key cities such as New York, Los Angeles, and London.
Even prime properties, such as in Lower Manhattan, are being dumped at huge discounts. This is wreaking havoc with landlords, lenders, and municipal governments who are marking down the values of buildings, loans, and tax assessments.
Over a trillion dollars in global equity has already been wiped out, but we are only in the early stages of what will be a long and deep depression in the commercial property market, especially in major US cities. Office utilization rates have not come close to pre-pandemic levels. Since, spiraling crime rates, homelessness, shoplifting, and migrant crises in the US and Europe have plagued the inner cities, pushing other businesses out. Soaring borrowing costs are also creating huge problems for the large volume of CRE loans that must be rolled over in 2024-2026.
Making these problems worse still, is how the collapsing downtown property values will adversely impact municipal finances. Local governments rely heavily on property taxes levied on office buildings, hotels, and other commercial properties, as well as income taxes on surrounding businesses. China's state-owned enterprises have been quietly disposing of these properties over the past two years; now they are doing so less quietly. Canada's largest pension manager just dumped two prime properties in New York and California for huge discounts. Now that price discovery is happening at shocking price points, time will tell when new buyers can be found to stabilize prices.

[@Ace1000ks19751982]

You will see a lot of blighted cities across America as the investment money dries up.

[@user-rl5wm1cm1k]

The blight has been here for decades.

[@frank-js9nf]

china has more than 700 big cities ,all ,clean ,modern , friendly and freedom visiting cities ,welcome to china for visiting

[@hassanj1861]

China is awsome, greetings from pakistan.

[@twu905]

Of all the people on KZbin, you give the best insight into economics situations. You explain what is the cause and the potential effects in very plausible manners. So many epiphany moments.

[@yingxu7908]

this is bigger than 2008

[@marks1167]

100 times bigger derivatives are over 100 trillion

[@walid7885]

One of the most informative Channels on KZbin. Straight to the point, no fluff.

[@micy9714]

This will trigger financial contagion .....

[@bingosunnoon9341]

China is the future. I was simply amazed when I visited. Difficult to be satisfied with living in the USA after seeing what I saw. Who wants to live in an old and shabby country?

[@wh4uf]

The indians and the Filipinos can inherit the US.

[@chenseongchin8600]

Thanks for watching. Be good!

[@user-rl5wm1cm1k]

This problem has a 2000 year track record (minimum). Banks not having any reserves! Junk Bonds as "Reserves"? The U.S. Government debt / bonds, notes / bills what ever, the issuer is fully bankrupt by any measure. Even to hold U.S. Dollars as reserves with now a every high probability of ongoing high inflation is less then ideal.

[@user-oo1oy8es6p]

Somebody bought at 75% off!! There is always a buyer if the price is right!!

[@ramonching7772]

I have a hunch. The 75% off is base on the capital put in. Not the purchase contract price. Sort of take over the original buyer's loan. So the problem is still there.

[@user-oo1oy8es6p]

@@ramonching7772 Its from the most recent or relevant high.

[@SteveXNYC]

China has all the Gold.

[@marks1167]

40,000 tons, Russia 15000 - 18000 Tons

[@wh4uf]

The us can keep all their useless printed dollars for themselves.

[@UPdan]

Indian people. No one touches that.

[@liamporter1137]

Informative. Thanks for sharing.

[@user-mm2yh1hr3c]

good independent thinker

[@daymay1066]

US and Europr are dying economically.

[@cheongseeksam3502]

The Biden government seems to believe wars can save US by destroying real competition.

[@georgejesson1944]

They're doing it to themselves

[@rohand03]

Everything in US is hanging by the threads.

[@Tampin111]

Very well explained

[@gregwang8628]

Short term profit driven speculation high leveraging brought in inflated valuations that are unsustainable, so deal with the unchecked greed below this surface, after all you enjoyed decades of profits, it’s time to pay up.

[@vengeancerecovery5535]

This is how americans "repo" & "force buying cheaply" against Foreign investments coz the one who are allowed to buy in $1 value is for american entities only....look back at history, u guys will noticed this...😊

[@Tampin111]

OMG Selling Santa Monica property at 75% off. That's the area where the filthy rich lives What's happening to America

[@georgejesson1944]

Third world status very soon with open southern borders. Let's go Brandon!

[@michaellorton8099]

The Terribly Complex Law of Unintended Consequences in Finance. “Oh, what a tangled web we weave when first we practice to deceive.” - Sir Walter Scott To add yet another metaphor to the mix: The chickens are coming home to roost.

[@marcgatto9675]

Appreciate your insight.

[@stephenc6955]

Kevin, let's improve the audio.

[@GiorniVenibato]

I noticed Chinese bought tons of low quality properties in NY state with high property tax ten years or longer ago!

[@priscillaferguson267]

For China, it’s called divesting 🤣🤣🤣🤣🤣🤣

[@UPdan]

Cities have promised too much in city employees benefits.

[@stickitupyourasteric]

to

[@jacquelinemorgan2086]

The situation is dire.

[@georgejesson1944]

It's china doing the "de-risking" not the US.

[@georgejesson1944]

Should be happening in the NATO allied countries as well to prevent illegal asset seizures

[@JTBSnetwork]

Wrong. Cities don't make money on rents. Or taxes in rents.

[@user-xq8qx6bg2j]

🙏🙏👍🌷

[@douginorlando6260]

I believe inflation comes from huge deficit spending by the government. The Fed Reserve jacking up interest rates are not gonna get inflation down to 2% … unless they create a severe recession. The central banks appreciate the Fed driving their competition into insolvency.

[@douginorlando6260]

Here’s a clue to the agenda. Yellen testified in public hearings the central banks would be protected but not necessarily regional and smaller banks. Her statement will make bank runs more likely as people decide to move their deposits to the safety of central banks.

[@user-nd2ku7ub5m]

Should we blame the Chinese again?

[@keirenle]

Can nt the like of black rock scoops up these cheap commercial real estate and turn them into flats, there s still a huge demand for housing right?

[@steverooke1717]

Smart cities on the cheap👍

[@sciagurrato1831]

Not at the prices Blackstone plans.

[@yingxu7908]

yes andNo some prefe TENTS

[@keirenle]

@@yingxu7908 😆😆😆

[@cyrusfarlow1307]

They can. And they will.

[@joem0088]

The Chinese must be taking a lot of losses.

[@astroganov]

That $1 trade looks like a typical cross-border property exchange

[@brianlowe3529]

They can afford it

[@georgejesson1944]

Better than losing it all through illegal asset seizures

[@Zerpentsa6598]

Invest now in US and Canadian REITs for great returns!

[@georgejesson1944]

Don't do it, tons of empty office buildings in major cities

[@dicky-duck6632]

May to Jun, interests will drop

[@americannumber2]

Hey Jerome Hayden Powell I did know you nick name is dicky

[@billinsf88]

Do you think it’ll drop to the same level of 2.5% to save the commercial real estate landlords? Loan payment is the expense side, the income side has dropped dramatically due to working from home. May to June interest rate drop if it even happens will be too little and too late for many landlords.

[@astroganov]

It's May already, and no move yet. And with new statistics available - they won't drop rates this year

[@blablah538]

Hey it's the guy with the interesting ex-pat takes but then the creepy Christian brainwash audio at the end of his videos

[@Kukaboora]

This is clearly the consequence of the real estate problem in China. It is quite parallel to the Japanese real estate bubble in the 1980. Japanese first bought a whole lot of real estates in the US, the Chrysler building, golf courses…. only to be sold at half prices when the economy of Japan got into recession.

[@shambalkaran9258]

Keep blaming others instead of finding the source of the problems

[@Kukaboora]

@@shambalkaran9258 Read the article by Theron Mohamed, Feb 16 2024 on Business Insider, titled “Commercial real estate is in big trouble- and the problems may have major financial fallouts”

[@Kukaboora]

@@shambalkaran9258 Read the article “Commercial real estate is in big trouble- and the problems may have major financial fallouts” By Theron Mohamed. Published by Business Insider on Feb 16 2024.

[@thetreekeeper143]

I think the Chinese are selling because they are being targeted. They also saw what happened to Russian assets when a war commences. If a war happens in Taiwan, the Western governments will confiscate all assets from China.