Is there a way to short CRE other than investing in non-commercial RE? I'd think you can probably directly short CRE-focused REITs but I'd be worried about them rebalancing or diversifying even as CRE starts to pop.
Does that help if you believe CRE is on the outs? CRE typically carries a much higher property tax burden, which means that if CRE starts to meaningly go by the wayside: That burden will shift to other property classes, making them much less attractive and/or cuts to services will be made, making the municipality much less attractive overall.