by Pam Martens and Russ Martens, Wall St On Parade:

Federal banking oversight agencies are in agreement: U.S. banks are facing a potential tsunami of problems with commercial real estate loans in the office space sector.

Last June 1, the Office of Financial Research (OFR), (the agency created under the Dodd-Frank financial reform legislation of 2010 to warn about financial stability risks), explained why the vacancy rate in office buildings is in dramatic contrast to the actual occupancy rate, and thus bodes poorly for the future demand for renewing office leases. OFR writes as follows: