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  • Writer's pictureRealFacts Editorial Team

The real problem with commercial real estate is people not coming to work, says New York developer, Bruce Ratner

empty office space

Bruce Ratner, a renowned New York developer known for his contributions to projects like Times Square, recently shared his insights on the commercial real estate market during an appearance on CNBC. In his discussion, Ratner highlighted several key points that shed light on the current state of the industry.

He began by emphasizing the nature of interest rates, noting that they tend to rise swiftly but take much longer to decrease. This observation is significant for developers and investors, as it influences decisions regarding financing and project feasibility.

Moving on to the office sector, Ratner expressed a grim outlook, suggesting that it hasn't yet reached its lowest point. He explained that office spaces' challenges aren't merely cyclical but indicative of a broader, structural shift in how people work. With remote work becoming more prevalent, the demand for office space is declining, posing a long-term challenge for this market segment.

In contrast to the office sector, Ratner highlighted a housing shortage as a notable issue. This shortage could present opportunities for developers, as the demand for residential properties continues to outstrip supply. Factors such as population growth and changing preferences contribute to this imbalance in the housing market.

Interestingly, Ratner indicated that if he were still active in the industry, he would focus on residential development. This suggests his belief that residential projects hold promise and resilience in the current market environment compared to other real estate sectors.

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