Ross Perot Jr. is sounding the alarm for a potential real estate recession if banks don’t start lending again.
Bank failures earlier this year, including the collapse of Silicon Valley Bank and Signature Bank, have caused an extremely tight lending climate across the nation. Perot, a real estate scion who serves as the chairman of Dallas-based companies the Perot Group and Hillwood, addressed the possible repercussions if banks continue to have cold feet, in an interview with Bloomberg.
Getting a construction loan in today’s market is like pulling teeth, Perot said. He’s had to provide funds to other developers as a result of this challenge.
“If the industry can’t get a construction loan, real estate will have a recession,” Perot told the outlet “The key to commercial real estate today will be banking.”
The banking crisis, compounded by already high interest rates, has caused real estate activity to cool in most major markets across the country. It’s affected all sectors. There could be a silver lining for the Lone Star State, though.
Perot is confident that Texas won’t be slowed by banking woes compared to other states. Its commercial and residential markets are benefiting from steady job growth, a huge wave of new residents and a number of corporate locations, he told the outlet.
His firm is developing the new Goldman Sachs campus in Dallas’ Victory Park neighborhood. The $500 million project will amass 980,000 square feet and house roughly 5,000 employees. Construction is slated for completion in April 2026.
—Quinn Donoghue
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