Brookfield Office Losses Trigger $10B Selloff Strategy

A Costly Bet On US Office

Brookfield, once one of the most aggressive buyers of US office real estate, is now contending with billions in losses, reports Bisnow. A wave of foreclosures is hitting Brookfield’s portfolio. Six suburban office buildings in Maryland are set for auction, symbolizing the challenges facing office owners across the country.

These buildings are part of a 12-asset portfolio Brookfield acquired in 2016 and 2017, backed by a $223M loan. That loan matured in August 2023 and remains unpaid, reflecting a pattern of distress that now stretches across Brookfield’s office portfolio.

From Expansion To Contraction

Between 2016 and 2018, Brookfield invested billions in US offices, buying at scale via portfolios and company acquisitions.

At the start of 2020, Brookfield’s office holdings topped 93M square feet and were valued at $33.5B. Today, that number is down to 68M SF and $28B. The company has either sold or relinquished control of over $3B in assets since the start of the pandemic.

Major losses include:

• Houston Center, handed back to lenders in 2024.
  
• 175 W. Jackson Blvd in Chicago, in foreclosure and reportedly near sale.
  
• A Brooklyn tower from Forest City Realty Trust, now in foreclosure after Brookfield defaulted on a $133M loan.

Facing The Debt Wall

Brookfield is now racing to manage more than $8B in office debt maturities through 2026, with $2.8B due next year alone. It’s currently seeking $2.5B in financing for two Manhattan towers: 660 Fifth Ave. and Five Manhattan West.

Despite these pressures, Brookfield insists its core strategy—owning high-quality, trophy office buildings—remains resilient. Its “super core” assets include:

• Brookfield Place (NYC and Toronto)
  
• Manhattan West
  
• 100 Bishopsgate (London)
  
• Potsdamer Platz (Berlin)

$10B In Office Sales On The Table

Brookfield is actively preparing to sell around $10B of its office assets by the end of the decade as part of a $45B real estate sell-off strategy aimed at pivoting from direct ownership to fund management.

This includes likely sales of marquee properties like:

• One Liberty Plaza, NYC
  
• One Leadenhall, London
  

The company’s goal: reduce its real estate holdings to under $35B, with only $18B in equity value remaining—down from today’s $80B valuation.

Market Headwinds Remain

Even as Brookfield tries to offload office assets, the broader market remains sluggish. In the US, office investment volume lags far behind industrial and multifamily. Valuations have fallen by 52% in major CBDs since the peak, and discounts are expected to remain deep—especially for older buildings.

Despite this, Brookfield is still raising capital successfully. Its latest $17B opportunity fund—aimed at distressed assets—has attracted strong institutional interest, underscoring investor confidence in Brookfield’s long-term playbook.

Why It Matters

Brookfield’s shift from office buyer to seller is emblematic of a broader industry reckoning. In the wake of the pandemic, office demand has been permanently altered, and as a result, many once-prized assets are now underperforming or underwater. Consequently, Brookfield’s pivot could set the tone for other major institutional players now reconsidering their exposure to the sector.

What’s Next

Expect more sales, additional write-downs, and continued restructuring ahead. As a result, Brookfield’s massive office portfolio—once a cornerstone of its global real estate strategy—is now being methodically downsized, one building at a time.

As investor appetite for high-quality offices slowly returns, Brookfield is betting it can recapture value and reposition itself as a leaner, fund-driven platform focused on opportunistic plays rather than long-term ownership.