Answer to Discussion post

respond ti this with 150 words Real estate loans are the largest loan category for all banks. Many different property types in commercial real estate will face serious financial problems in the next 10-20 years. COVID has and will continue to turn the real estate industry upside down. In my opinion, retail pads with gas stations/oil changes/ shopping malls/ etc. will not be able to keep up with debt payments. The US government is has already started the conversation on banning the new production of gas powered vehicles - there is a real possibility this could happen by 2035. Gas stations will slowly become less common and the owners of these pads will have to sell at a price significantly lower than what they acquired it for. Charging stations will not be needed as much as gas stations because most homes will have chargers as well as employers. Oil changes will be hit hard due to the fact that electric vehicles require a smaller amount of oil compared to that of their gas powered counterparts. Shopping malls have been turned upside down from the rise of online shopping and many will have to be converted into industrial last mile warehouses for powerhouses like amazon. Office life will never be the same with the threat of viruses and I assume many occupations will work from home forever. This list could go on and on. The point is - lenders must be careful and go through a thorough due diligence period before making large commercial loans to companies and industries that could face problems 10-20 years down the road.