As never having participated directly in CRE, this seems underappreciated as now a normal part of multiple cycles :

"In February Brookfield elected not to extend the maturity of its loans against two office towers it owns in
L.A. (the Gas Company Tower and 777 Tower). Brookfield also declined to purchase interest rate
hedges against its floating-rate debt. These actions put the mortgages into default and the towers could
face foreclosure. So far the lenders have not taken action. As they say, if you owe the bank $1 million,
you have a problem. If you owe the bank $784 million, the bank has a problem
While a default isn't good news, it's not catastrophic either. Brookfield finances its properties with non-
recourse debt to prevent problems at an individual property from affecting Brookfield as a whole.
According to Brookfield, a flight to quality has been a net benefit to the company's portfolio. The default
is likely a calculated bet to gain negotiating leverage with lenders who'd prefer not to take possession
of the towers."

ref : eagle point capital 2023 april substack