The rise in interest rates is putting pressure on the value of real estate and in particular commercial properties, also sunk by the spread of smart working
After limiting withdrawals from his Real Estate Income Trustthe bottom Blackstone defaulted on a bond from 531 million euros guaranteed by a portfolio of offices and shops held by the Finnish Sponda Oy. Blame the rise of the interest rates which puts pressure on the value of properties and in particular of the commercial ones, also affected by the diffusion of the smart working. Second Bloombergthe private equity group probed the possibility of a one-year extension of the repayment terms, but the bondholders voted against.
A Blackstone representative stressed that the unpaid debt refers to a “small portion of Sponda’s portfolio.” The asset management group had been aiming to sell the underlying properties for years, but Covid e war in Ukraine they made it impossible to proceed. Now the rate crunch has cold further the commercial property market in Finland.