Around $175 bn of real estate debt is under threat of default, market data shows, Invest-Gate reports.

The amount of credit facing default exceeds that in the next biggest industry by four times.

The market is panicking, as lenders advice borrowers to sell assets or risk foreclosure amid demands for additional capital from landlords.

The global real estate market is severely hit by higher construction costs and interest rates.

The European market is suffering instability due to liquidity, with commercial properties dropping over 20% in value, a report Weil, Gotshal & Manges says.

“What we have in this downturn is a fairly unique set of economic circumstances. Interest rates are tightening instead of softening the blow for real estate and other corporates,” Senior Managing Director of the loan advisory team at Jones Lang LaSalle, Ian Guthrie, says.