Corporate Governance

U.S. Business Equipment Borrowings Up 4% in February, ELFA Says

U.S. companies borrowed 4% more to finance equipment investments in February compared to a year ago, industry body Equipment Leasing and Finance Association (ELFA) said, Reuters reported. Companies signed up for new loans, leases and lines of credit worth $7.9 billion in February, down 15% from a month ago. "Credit quality, while still elevated year over year, showed improvement with delinquencies slowly returning to normal levels and charge-offs moving in a positive direction,” ELFA CEO Leigh Lytle said. The Washington-based company, which reports economic activity for over $1-trillion equipment finance sector, said credit approvals for U.S. companies in February came in at 76%, unchanged from the preceding month. Its nonprofit affiliate, the Equipment Leasing & Finance Foundation, said its confidence index for March stood at 55.2, up from 51.7 for February and was at its highest level since April 2022. A reading above 50 indicates a positive business outlook. ELFA's leasing and finance index is based on a 25-member survey, including Bank of America, and financing units of Caterpillar, Dell Technologies, Siemens AG, Canon Inc. and Volvo AB.
Please note that in order to view the content for the Bankruptcy Headlines you must either sign in if you are already an ABI member, or otherwise you may Become an ABI Member

U.S. Office Occupancy Faces “Black Hole” of Remote Work, Says Green Street

Remote work has caused a “black hole” in U.S. office occupancy, knocking demand significantly below pre-pandemic levels and vacancy rates to historic lows, with a recovery to prior usage unlikely for years, said real estate analysis firm Green Street, Reuters reported. In addition to the decline in demand due to working from home, the office sector also faces headwinds from companies that are now more cost-conscious with their budgets, the firm said. The result has caused cumulative net absorption — the amount of leased space less what has been vacated — to have declined by 130 million square feet of U.S. office space since the 2020 COVID-19 pandemic, the firm said in a note called “The Black Hole of Office Occupancy.” “The last four years of disruption in the office market have been the worst on record,” said Newport Beach, Calif.-based Green Street. “The cumulative amount of office space vacated since [2019] surpasses the amount seen during the dot-com bubble and dwarfs that of the Global Financial Crisis.” Available office space was about 25% of existing supply at the end of 2023, both historic highs. For U.S. office occupancy to reach pre-pandemic levels it would take five years based on ambitious assumptions, such as an absorption rate of new supply on par with 2019 when the economic outlook and strong expected job growth made demand better. A realistic recovery scenario suggests about 1% office-using job growth and less than 1% supply growth over the next five years would result in U.S. occupancy rates not recovering to 2019 levels for a long while, the firm said.
 
ABI will present a program April 30-May 2 that will address CRE exposure: the 2024 Distressed Real Estate Symposium, to be held in Ojai, Calif. Click here to register!

 

Please note that in order to view the content for the Bankruptcy Headlines you must either sign in if you are already an ABI member, or otherwise you may Become an ABI Member

Pages