What does everyone think ? Will commercial real estate hold up this time if stocks tank again or has it all become "risk on"'or "risk off" where all asset classes become correlated ???

The stock market and Real Estate market are two very different things and are not correlated. The stock market is and has been artificially propped up by the Fed and Treasury and they will continue to do so. They are buying anything and everything without regard for value or expectation of profits. In fact Powell is on record saying he is not concerned about the loss that could be incurred buying corporate bonds of bankrupt companies. When they buy these instruments it then puts money in the hands of the investors who in turn buy more overpriced assets to then dump back on the Fed.

The Fed is keeping rates low and treasury is buying MBS, CMBS and Bonds which is keeping the real estate market flooded with liquidity. As long as rates remain low and lenders are lending the real estate market will continue to do well. Especially right now when demand is at all time high and inventories are at all time lows. This is average across the board of course as every market is different and you can find the opposite effects in some areas.

@Steven Zoernack when the stock market becomes bearish over the long-term, capital seeking yield will move to other investment assets, CRE being one of them. Even though they are uncorrelated, that same dynamic exists when the CRE market corrects as well, since history repeats itself and all asset classes experience cycles. However, inside CRE, there are asset classes that outperform, even through a broader bear market.

It also pays to look at the other side of the coin where you find high volatility and exposure to loss. Through that lens, I would much prefer to have capital exposed to CRE than public equities, particularly to recession resistant real estate.

In the long run, I think both will continue to do well. It just depends on your portfolio goals and level of active work.