Office buildings face $117B debt in US

The imminent maturity of billions of dollars in loans tied to office buildings poses a significant threat to the US economy amid a surge in interest rates.

Approximately $117 billion of such loans are slated to come due this year, requiring repayment or refinancing, as reported by the Mortgage Bankers Association.

A substantial portion of these loans is at risk of default, potentially leading to substantial financial losses for banks and developers and pushing some into insolvency.

The original loans for office spaces across the nation were secured when interest rates were considerably lower than their current levels, making it challenging for owners to refinance at higher rates.

Unlike home loans, commercial mortgages often involve interest-only payments, with the principal amount due at the end of the term or requiring refinancing to initiate a new cycle, the Daily Mail reported.

READ MORE: https://www.dailymail.co.uk/news/article-12916911/US-office-buildings-face-117BN-debt-time-bomb-Mortgages-year-threaten-sink-economy-thousands-workplaces-remain-empty.html

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