I.e. they rather have someplace empty than rent it out at the still quite high market rate.
There has to be some don't ask don't tell policy going with the banks for that to work?
Now you and I, we're all about the cash flow. But there are serious accounting complications when the balance sheet changes.
Plus it's not a good look to reassess asset values up and down all the time (it's a red flag to the tax man) so its better off trying to get a long-term view, not a short term one.
But to answer your question, no occupancy is not generally a factor when considering a buildings value. It's too volatile to be a useful input against a long-term asset.
A property can take a loan based on their balance sheet asset value which is based on the rent price, if those rents are too expensive for the market and keep the building mostly unoccupied it means that the asset value is inflated, since it cannot achieve its supposedly sheet value as the rent is not attractive and won't generate cash flow, if/when the building as an asset is sold the buyer will want to have it to generate cash flow and that requires renting out as much as possible for the higher amount possible, so at some point the whole charade just implodes?
Wrapping my head around financial tricks is quite hard sometimes, some of it just feels like smoke-and-mirrors way too detached from reality. Is it because it's mostly purely quantitative rather than qualitative in the 2020s?
But buildings are not revalued all the time. They typically revalue when they change hands. You might have it revalued (up) if you want to get a bigger loan, but it's not like the bank is running around revaluing buildings in case they went down. (It's not good for them to acknowledge it's underwater either.)
Both parties are optimizing for the _long game_. If the market is in a short-term slump (think < 5 years) then it pays the bank to wait for a recovery, and it pays the company to hang on.
Yes, if done at scale, across an industry, then the wheels can come off in a big way (as happened in 2008) but for short term fluctuations there's a polite understanding that it's in everyone's interest to carry on through the downswing into the next upswing.