Work-from-home (WFH) headwinds combined with pressure from elevated interest rates, higher borrowing costs, and decreasing investor flows have hit the U.S. office sector especially hard, according to a recent report from Hines titled, “Diving ‘Debt-First’ into U.S. Office.” Meanwhile, a wave of upcoming loan maturities is creating the need for significant capital when funding availability is challenging.
Against this backdrop, Hines sees an opportunity forming for investors to sequence their exposure to the office market — a process that starts with a risk-adjusted approach to tactically leveraging debt. However, this is only the case for assets that can thrive in a WFH world. There is convincing evidence that higher-quality, well-located assets may do just that.
Why does Hines think the U.S. office sector may be especially attractive for debt investors at this point in the market cycle?
Reset property pricing: Valuations are down, and the headwi
