Birmingham Business Journal Quotes John Pickering on Expectations for Commercial Real Estate in 2024

John Pickering, partner in the firm’s Birmingham office and Co-Chair of Balch’s Financial Services Practice, shared his perspective in an interview with the Birmingham Business Journal regarding expectations for commercial real estate in 2024 and the impact of signals from the Federal Reserve about the potential reduction of interest rates.

In the article published January 2, John pointed out that even the anticipation of rate cuts could yield a beneficial effect on the Commercial Real Estate (CRE) sector. Such forecasting may encourage potential buyers and developers to proceed with transactions that have only marginal profitability or require more upfront investment, he explained.

“Their rationale will be that the projects can be refinanced in a year or two when rate cuts have really kicked in,” John was quoted as saying. “That kind of logic is particularly compelling when you haven’t done a deal in a while.”

In his interview, John noted that the speed and magnitude of the rate cuts will matter most. 

“A bigger appetite for deals from CRE market participants will increase the demand for loans, and banks will respond accordingly by making more loans, although the size of the increase won’t necessarily be large unless the Fed cuts rates much more aggressively than most people expect,” John was quoted as saying.

John’s more than 25 years of experience in real estate development and commercial lending positions him as a trusted advisor to various stakeholders in the industry. He represents a diverse client base including real estate developers, banks and other financial institutions, publicly and privately held commercial and real estate investment companies and individual investors.

John is a past Alabama Chapter President for the NAIOP Commercial Real Estate Development Organization, is a member of the American College of Mortgage Attorneys, and has served as an adjunct professor at The University of Alabama School of Law.