Commercial real estate has had an almost uninterrupted run of increasing values since bottoming in the wake of the global financial crisis in 2010. Acquisition yields have persisted at historical lows for several quarters, and many question how long the asset class can remain priced to perfection.
As we head into 2017, a potentially bigger impediment has emerged: rising interest rates. The 10-year Treasury rate increased more than 65 basis points between the election and Christmas as investors react to the prospect for more robust domestic output during a Trump’s administration, the potential for reduced oil output and more aggressive monetary policy by the Federal Reserve.
Read more...How Will Rising Interest Rates Affect CRE?
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