Bouncing back: the political economy of crisis and recovery at the intersection of commercial real estate and global finance

Abstract

A growing literature demonstrates that the increasingly inter-dependent relationship between finance and real estate intensifies the boom-bust dynamics associated with property markets. Thus, the relationship between finance and real estate is frequently critiqued by examining how it produces crises with devastating impacts on societies, economies and cities. But despite the focus on property crises, much less attention is paid to the resolution of financial real estate crashes. How do bust property markets recover? And with what consequences? This paper responds to these questions by examining Dublin’s office real estate market. Dublin is a particularly suitable case as its booming property market collapsed in 2008 but recovered rapidly from 2013. Analysing the transition from crisis to recovery provides important insights at a number of levels. Firstly, just as credit is crucial to property booms, the relationships between finance and the built environment play a crucial role in shaping the recovery of Dublin’s office market. Secondly, state intervention in the financial system is crucial to this process. Finally, the dynamics associated with recovery work through the production of new circuits linking finance and commercial real estate.