Tuesday, October 1, 2013

Report: Rising Caps Will Meet Stronger CRE via GlobeSt.com

Rising interest rates, which the capital markets in general and the CRE industry in particular have been watching anxiously over the past few months, most likely will happen as the economy improves and the Federal Reserve begins tapering off its monthly $85-billion bond purchases. Yet in the long term the improving economy will boost CRE performance even as cap rates rise, says Marcus & Millichap in its fall capital markets report, which GlobeSt.com obtained exclusively in advance of its publication.

The tapering of the Fed’s quantitative easing should mark a return to a more normal credit environment, wherein interest rates fluctuate naturally in response to economic and capital market drivers more than Fed intervention,” according to the report, written by Hessam Nadji, SVP and managing director with Marcus & Millichap Real Estate Investment Services, and William Hughes, director of Marcus & Millichap Capital Corp. “Many investors remain concerned, however, by the premise that a stronger economy, coinciding with withdrawal of Fed monetary support, will exert upward pressure on interest rates.”

Read more...Report: Rising Caps Will Meet Stronger CRE - Daily News Article - GlobeSt.com

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