© Reuters. A crane is pictured at construction site near residential apartment buildings in the Ile de la Cite, in Paris, France, March 7, 2024. REUTERS/Gonzalo Fuentes/File Photo
FRANKFURT (Reuters) – The commercial real estate sector is “particularly vulnerable” to the recent rise in interest rates, resulting in more loans going unpaid, European Central Bank supervisor Claudia Buch said on Tuesday.
“One sector which is particularly vulnerable to higher interest rates is commercial real estate,” Buch said in a speech. “A little less than 4% of these loans were classified as non-performing – above the average…for loans overall.”