Brookfield wants US$15 billion for real estate bet after stumbles
BNN Bloomberg
As downtown skyscrapers sat empty in the aftermath of the pandemic and central bankers were about to embark on the fastest pace of interest-rate hikes in a generation, the Canadian asset-management giant Brookfield doubled down on one of the bets that made its name: buying office buildings.
The firm’s property funds spent US$7.2 billion on office real estate investment trusts in Germany, Belgium and Ireland in late 2021 and early 2022, decisions that sparked debate both internally and from some of its major investors, according to people with knowledge of the discussions. Yet the deals went through, in accord with Chief Executive Officer Bruce Flatt’s longtime playbook of buying seemingly undervalued assets and wagering they’d appreciate over time.
It’s a strategy that helped build Brookfield Corp. into one of the world’s biggest owners of commercial property. Now, as office values languish and higher rates persist, the investment firm is at the center of a global real estate shakeout.
Prices for most European and U.S. offices have tumbled in the past two years. And the effects are rippling out, pummeling banks from New York to Japan that have bet big on the space.
