The corporate real estate (CRE) profession – and many others – had been waiting seemingly endlessly for cuts in interest rates. Now that the Federal Reserve has done so, and promised that more cuts are on the way, is it too little, too late?

For some perhaps, according to The Wall Street Journal. 

“Many owners of apartment buildings, hotels and other real estate took advantage of rock-bottom rates a few years ago, loading up on debt when borrowing was cheap. After rates soared starting in early 2022, they missed payments and had to hope their creditors would extend deadlines,” according to the article.

“The rate cut is welcome news to a commercial-property market that has struggled with sinking valuations, stalled sales and difficulties refinancing. More than $2.2 trillion in commercial-property debt is coming due between this year and 2027, according to data firm Trepp.”

But the Fed’s deliverance won’t be enough for some of America’s most highly leveraged property owners. Lenders that have been willing to extend their loans have run out of patience, the article reported.

Still there is hope that we have turned a corner.

“Once the dust settles, lenders might also be more forgiving of landlords than in years past,” said Michael Lavipour, an executive at lender Affinius Capital, in the article.