Starwood Capital Group, the company of famous billionaire Barry Sternlicht, recently defaulted on a $212.5 million loan due July 9, which was attached to an office tower in Atlanta, Bloomberg reported. According to the information obtained, the company confirmed that it would not be able to pay the loan on time and stated that it is currently in negotiation talks with the lenders.
The recent financial crisis of famed billionaire and Starwood Capital founder Barry Sternlicht reflects the turmoil in the commercial real estate industry, with higher interest rates, tighter lending standards and work-from-home trends, experts say. In particular, after the banking turmoil earlier this year, higher borrowing costs and tight access to credit have made it harder for many homeowners to refinance their debt, leading them to default.
Uncertainty in the commercial real estate sector is already starting to worry investors about whether a new mortgage crisis is starting. Some even speculate that the industry is “collapsing”. Global office buildings could lose $800 billion in value if remote working trends continue, according to a recent warning from the McKinsey Global Institute.
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