Other investors fear of additional suffering as Goldman Sachs resumes US property bets.

 Goldman Sachs Asset Management's real estate boss stated the market is bottoming out, so the company will continue "actively investing" in U.S. commercial property this year. Other investors indicated the decline was still ongoing.

U.S. office and commercial property prices have plummeted because to rising interest rates and vacancy rates that have surpassed other countries since the pandemic.

The price drop has shaken U.S. regional banks with considerable exposure. At the MIPIM property conference on the French Riviera this week, investors predicted more office sector weakness. On Wednesday, a Brookfield Asset Management (BAM.TO), opens new tab executive dubbed the U.S. "the most oversupplied office market in the world" and claimed investors had too much debt. GSAM's real estate head, Jim Garman, identified a buying opportunity.

"The reason is a combination of interest rates coming down, we feel like the market is bottoming out, and because we're starting to see a floor in prices set by buyers who are in the market," Garman said at MIPIM. Garman said Goldman Sachs (GS.N) asset management had invested more in real estate in Europe and Japan during the past three months, without quantifying its stake.

He worried about the speed of a U.S. market revival, but the economy should be strong. "We don't think its going to be a very sharp V-shaped recovery – we think we're going to bump along the bottom for a while, as a lot of these over-levered situations in the asset class get worked through," said.

British investment manager Schroders (SDR.L) opens new tab is also ready to strike. Sophie van Oosterom, its global head of real estate, said it is employing a local team to buy billions of dollars in U.S. commercial property, focusing on multi-family rental housing.

Van Oosterom said Schroders is hiring a U.S. real estate team and considering purchases or investments in local enterprises. Executives told a Cannes panel on Wednesday that some commercial real estate was holding up and clients were interested in logistics and data centers rather than offices. Michael Lascher, Blackstone's global head of real estate debt capital markets, said high-quality sustainable workplaces are valued differently.

Real estate values are falling, raising concerns about a financial spillover if banks take substantial property loan losses. CRE risks at banks were under "clear focus" from regulators, said Citi senior commercial real estate executive David Bouton.

He said lenders with stronger capital buffers were more flexible to investors than during the 2007-09 global financial crisis. Others tried to downplay analogies to the global financial crisis. GSAM's head of real estate in Europe, the Middle East, and Africa, Richard Spencer, said banks today have "the capital cushion to take action".

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