Dot-com telecom overbuild (1999-2001)
Telecom carriers borrowed billions against projected bandwidth demand to build fiber networks and data centers. Demand arrived more slowly than the debt, triggering bankruptcies and distressed asset sales.
Waves of telecom bankruptcies, including WorldCom in 2002; fiber capacity sat dark for years.
Lenders learned to scrutinize projected-demand financing; overbuilt assets took a decade to absorb.
A cautionary parallel for any financing that backs future demand with debt: if occupancy lags, the carry burden falls on borrowers.
