In the summer of 2019, I wrote a Forbes piece in which I warned about the U.S. commercial real estate bubble that was inflating and why I believed that it would end badly. Around the same time, I wrote another Forbes piece warning that there was about a two-thirds probability of a powerful recession within the next year and that U.S. commercial real estate was one of the bubbles that would burst as a result. In the current piece, I will explain why the U.S. commercial real estate bubble is likely to burst in the near future as a result of the coronavirus pandemic-induced recession.
As a result of the Federal Reserve’s stimulative monetary policies, U.S. commercial property prices have more than doubled since their 2009 low:
Ultra-low interest rates encouraged a borrowing boom in which commercial real estate loans at U.S.