Property Play · Sep 29, 2026 · 28m · 16m saved
With Richard LeFrak, Chairman and CEO of LeFrak
LeFrak has run his family's real estate company for 58 years, through the rate spikes of the late 1970s, the dot-com bust, the 2008 financial crisis and Covid.
Most owners with debt on their books are hoping the Federal Reserve bails them out. LeFrak, who has none, is doing the opposite: waiting for the losses to land on someone else's balance sheet so he can buy the asset underneath them.
"If I had debt, I would be petrified."
Richard LeFrak, chairman and CEO of the family-owned LeFrak Organization, told CNBC's Diana Olick on Property Play that today's commercial real estate market sits "in between terrible and okay," with a wall of refinancing still to clear before it gets better.
The full segment is covered here so you can skip it. 28 minutes of audio, 11 minutes of reading.
Here are the 8 takeaways that matter.
Key Takeaways
The industry has to refinance about $750 billion in the next two years, after property values fell an average of 20% since rates rose
He put some property types' losses as high as 50%
Patient, unlevered capital can now buy real estate "at the right attachment point," he said, as banks stop extending troubled loans
Leasing office space is "a rich man sport," because landlords front tenants years of free rent before signing them
He'd rather own Vornado, SL Green or Boston Properties stock than run that business directly
Fears that Mayor Mamdani would drive tenants out of Manhattan were overblown, he said, pointing to how young the workforce moving into new leases still is
Seventy years of rent control, not politics, is why New York hasn't built enough housing, in his view
Florida's population is projected to reach 30 million within a decade, and he says he is simply following the people, even as foreign buyers have thinned out
Tariffs and AI's own data-center buildout have both pushed up his construction costs, competing for the same materials and labor
His own data center became "yesterday's news" within five years and is now an ordinary office building again
1. The $750 Billion Wall
Olick opened by running through the crises LeFrak has survived — the double-digit rates of the late 1970s and early 1980s, the dot-com bust, the 2008 financial crisis, Covid, and, as LeFrak pointed out she'd left out, September 11. Asked to compare today's market to all of that, he landed in the middle.
He calls today's market "in between terrible and okay"
"Well, it's not as bad as it could be, but there've been a lot better days, too. So I would say I would say it's kind of in between terrible and okay." — Richard LeFrak
Pressed on how higher rates have filtered into property values, he said the damage has already been done and the bill is now coming due.
Property values are down 20% on average, and the industry owes about $750 billion
"In the last three or four years values have deteriorated with the rise of interest rates and I think values depending on the property type could be as much as 50% in some but on average I'd say about 20% loss of value." — Richard LeFrak
"The number I saw was about $750 billion in the next two years." — Richard LeFrak
That figure sits within the range other trackers have published for the coming wave of commercial mortgage maturities, though estimates vary widely depending on the dataset and the window measured. LeFrak's arithmetic from it is rough but simple: if roughly a fifth of $750 billion has to be written down, that's about $150 billion of losses somebody has to absorb.
Owners with debt should be scared; owners with cash should be hunting
"If I had debt, I would be petrified." — Richard LeFrak
He said banks are no longer willing to "extend and pretend" on troubled loans and are getting more aggressive about selling them off or disposing of the underlying assets, which is where he sees the opening.
"If you have patient capital, you'll be able to find good real estate at the right attachment point." — Richard LeFrak
He added that private-equity real estate funds generally "have not lived up to their expectation" in recent years, and that a traditional source of rescue capital, Gulf sovereign wealth, is now focused on rebuilding infrastructure damaged by the war in its own region rather than writing checks for US property.
