Real estate shares and bonds rebounding
Rallies vulnerable to central banks dousing rate cut bets
Property price collapse moderating, gains expected by 2025
Debt fears and high office vacancies still weigh on sector

LONDON, Jan 24 Reuters Commercial property stocks and bonds are rallying as forecasters widely predict the end of a market slump triggered by a multitrillion dollar debt burden.

Real estate investment trusts REITs, the stockmarket listed commercial building owners, have rebounded to levels last seen before U.S. lender Silicon Valley Bank collapsed in March 2023, sparking fears of a major credit crunch for landlords. 

Commercial property bonds are also pricing better times ahead as flows into property investment funds pick up.

The rally is pegged firmly on hopes that major central banks will cut interest rates from multidecade highs, relieving intense pressure on landlords and their lenders and driving forecasts that buildings will stop losing value.

We39;re close to the bottom of the market, we really believe it, said Kim Politzer, head of European real estate research at Fidelity International.

For us it seems sensible now to be planning to deploy more money into it.

With UK commercial property values down by about 25 from a mid2022 peak, Nick Montgomery, head of UK real estate investment at Schroders, said Britain39;s market was at or near the bottom, pointing out that rents were up 4 in 2023.

BlackRock, the world39;s largest asset manager,…