Commercial Real Estate CLOs on the Edge

There are some conversations that don’t just inform – they shift your perspective.

Sitting down with Rod Dubitsky, affectionately known as “The People’s Economist,” was one of those moments for me.

Rod is someone who has spent over 30 years inside the financial services machine, yet he brings a refreshing, almost renegade clarity to the often opaque world of commercial real estate finance.

When we hit record for this Real Estate Lowdown episode, I expected insight. What I didn’t expect was to walk away with a whole new lens on where the commercial real estate market might be headed – and what it means for all of us.

We dove into the contrasting realms of traditional balance sheet lenders versus their more speculative, financialized counterparts. Rod helped break down how “extend and pretend” practices and delayed foreclosures have kept certain market realities at bay – for now.

But the real thunder rolled in when we turned to the Commercial Real Estate Collateralized Loan Obligations (CRE CLO) market.

If you’re getting 2007-2008 déjà vu, you’re not alone.

Rod unpacked how roughly 80% of these CRE CLO deals currently limp along with a debt service coverage ratio below one. That’s a sobering stat – and a flashing red light for anyone paying attention.

These aren’t just numbers.

They represent a system propped up by tactics designed more for optics than for long-term solvency.

High loan modifications, redefaults, and artificially propped-up valuations?

It’s a risky game with ripple effects far beyond real estate.

But Rod doesn’t just diagnose the problem – he’s offering solutions.

His initiative to democratize access to personal finance tools is not only timely, it’s essential. In an environment this fragile, informed individuals aren’t just empowered – they’re necessary.

As we widened the lens to look at demographic trends, rising interest rates, and the looming specter of climate change, one thing became clear: the fundamentals still matter.

“In a world addicted to short-term fixes, Rod’s call to return to economic basics is a welcome reminder of the value of clarity, truth, and disciplined thinking.”

If you’ve ever felt like the financial world is speaking a language designed to keep you out, my podcast interview with Rod is your Rosetta Stone.

Until next time,

– BB

LISTEN to the full episode – it’s one you don’t want to miss.

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