It’s no secret that the commercial real estate market has been struggling for a while now. However, muni bond fundamentals remain strong.
Ever since hybrid and remote schedules became more popular work practices, commercial real estate has struggled. According to a Q2 2024 report from Moody’s, the office sector vacancy rate sits at 20.1%. Moody’s adds that this is the first time in history that the office sector vacancy rate surpassed 20%.
While some investors may worry about how office vacancies could affect municipal bonds, experts say there is no need to be concerned. In recent insights, the Eaton Vance team notes that the major cities have “significant time to address the potential budget shortfalls”, adding that cities have plenty of options to rebalance their budgets.
etftrends.com
by Nick Wodeshick
September 24, 2024