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Pimco's Columbia Property Trust office REIT defaulted on $1.7 billion in debt tied to a seven-building portfolio.Multinational real estate giant Brookfield last month defaulted on over $750 million in debt tied to two office buildings in downtown Los Angeles.

The latest: Signs of stress are picking up, with delinquencies on commercial office mortgages touching 2.4% in February, up from 1.5% six months ago, according to Trepp. Office rents - especially in large cities with lengthy commutes - have fallen, too.Office building appraisal values were down 25% in February compared to a year prior, according to a Goldman Sachs note that cites research shop Green Street.Utilization - how many people actually use the offices that their companies rent - is down roughly 50% from pre-COVID levels, according to swipe-card systems operator Kastle Systems.State of play: Office utilization is still low compared to the before-times, with WFH and hybrid set-ups now standard for millions of former office drones.īy the numbers: Nearly 30% of companies still have remote or hybrid options - though that's come down from 40% in 2021, the latest government data shows. If it gets bad enough, it may undermine banks, crimp lending and slow the economy.It could touch normies, too, by hurting pension fund performance and city tax revenues.Why it matters: A deep downturn in property values is more than a problem for oligarchs, feuding billionaire clans and oil-rich foreign wealth funds.

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Office vacancies - plus the still simmering banking crisis - have us considering what a potential bust in the $6 trillion U.S.

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