It’s been obvious since the pandemic struck that commercial real estate would be hit hard. The demand for office, retail, and hotel space has been crimped more or less permanently by Covid-19, which taught people to do many things online instead of in person. A worker whose skills are no longer needed can switch careers, but a building will always be just a building—a brick-and-mortar sitting duck.

The surprise to date has been how few bankruptcies have occurred in commercial real estate. One reason for that is a slow fuse. In February my Bloomberg colleague Allison McNeely wrote, “Troubled borrowers secured breaks of six to 18 months on their debt last spring as the pandemic shut off large parts of the economy and revenue dried up. But nearly a year later, some lenders are running out of patience and don’t have the ability to keep…

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