Bank OZK’s Sudden 17% Drop Puts Focus Back on Real Estate Stress
- Citi downgrades bank on ‘largely idiosyncratic’ property risks
- San Diego life science complex is among properties struggling
The boom in the development of life science buildings has created a supply glut.
Photographer: Patrick Bolger/BloombergThis article is for subscribers only.
It seemed like a smart real estate play in the wake of a global pandemic: build life-science labs to satiate soaring demand for space to develop medical breakthroughs. Bank OZK was among those to bet big on the industry, most notably through a sprawling San Diego waterfront complex.
The Little Rock, Arkansas-based bank’s sudden 17% stock plunge, after a Citigroup Inc. downgrade flagged challenges with that San Diego district and other commercial-property risks, suggests that flare-ups from the embattled real estate market aren’t going away anytime soon.