Investors Eye Distressed Properties In Preparation For A Market Correction

Commercial real estate, towers, office building

Investors are raising funds to take advantage of distressed properties as they prepare for a correction to spread across parts of the commercial real estate industry.

While a huge downturn is not expected, analysts are saying the market is showing signs of cooling in the near future, the Wall Street Journal reports.

Many are seeing opportunity in a potential slump in part because of the large number of nontraditional lenders present in the most recent market.

According to the WSJ, firms such as Madison Realty Capital, Delshah Capital, venture investor Michael Ashner and New York developer Steve Witkoff have all gotten a head start and either begun raising money or started planning to solicit funds to target struggling commercial properties. 

Although private equity funds such as Blackstone Group are unlikely to raise money for these properties, they do have money available to purchase assets such as struggling shopping centers and condo developments that are not achieving sales projections.

Investors will have their sights set on distressed properties in New York and Washington, among other large cities.

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