Josh Brown, CEO of Ritholtz Wealth Management, said on CNBC’s “Halftime Report” on Friday that he added to a position in CBRE after CBRE stock tumbled on investor concerns that artificial intelligence would squeeze demand for office real estate. CBRE and office real estate stocks fell sharply this week after Elon Musk said on a podcast last week that office towers once filled with employees will one day be replaced by AI. CBRE stock plunged 12% on Wednesday and is expected to fall 16% this week. Brown says fears that AI will revolutionize the world of commercial real estate are overblown. “Literally, none of this is destructive,” he said. “These stocks have just been completely crowbarred. But if you know literally anything about commercial real estate, you understand that nothing you see on your screen is based in reality.” CBRE 5D Mountain CBRE 5D Charts Brown noted that commercial real estate has since recovered from COVID-19 at a time when investors were similarly misinformed about “skyscrapers in the sky around the world.” “If you don’t learn a lesson from that, I don’t know what to tell you,” he said. “I think that’s a really crazy story. I don’t believe it. I think in five years, if it didn’t happen, we’d all be laughing out loud.” Brown added that acquiring CBRE was an easy decision in the current downturn. “I laughed when I saw this. I hit the buy button this morning. I didn’t say I’d hold it forever. I think it’s an easy transaction,” he said.
