Motley Fool Money The Office Space Depression
Sep 22, 2023
Join Ron Gross and Matt Argersinger, both Senior Analysts at Motley Fool, as they dissect the current turbulent landscape of office real estate, hinting at challenges that even REITs might face. They explore the Federal Reserve's stance on interest rates and the financial ramifications of recent labor disputes across major industries. Meanwhile, Justin Hotard from Hewlett Packard Enterprise shares his insights on artificial intelligence, debunking common misconceptions and offering advice on how to start learning about this transformative technology.
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Impact of Low Interest Rates
- The period of near-zero interest rates (2008-2021) inflated long-duration assets.
- This incentivized investment in companies with distant future cash flows, particularly growth stocks.
Office Real Estate Depression
- Office real estate is experiencing a deep downturn, possibly worse than the Great Financial Crisis.
- Unlike 2009, the post-pandemic shift in office demand makes recovery less certain.
REIT Opportunities
- Consider REITs, especially those without office exposure, as they trade at multi-year lows.
- Prologis and Realty Income are examples of well-run REITs with attractive valuations.