On the other hand, fixed-rate borrowers should not feel any impact, he adds. "The impact for fixed-rate borrowers has taken place over the last 12 to 13 months as rates have increased with the expectation that the Fed would begin to tighten," Gabriel explains.

The industry insider doesn't expect a significant impact now--but that depends on how quickly rates increase versus the improvement of fundamentals. "As job growth continues and the economy continues to improve occupancy rates should continue to improve and we should see a return of rental-rate growth and the elimination or reduction of concessions with respect certainly to office leasing," Gabriel says. "To the extent that those benefits appear sooner, or more rapidly, than rates increase I think there could be a positive impact, generally speaking, on the market. If rates move up faster than the fundamentals improve I think you can have a negative impact on price."

Not that Gabriel predicts this will happen in the near future. "In the four- to six-month time frame in an election year I don't see much changing of a significant nature on the interest rate front," he adds. "I think the allocations for real estate, which are made near the end of the prior year, are out there and are out there to be spent. So for the balance of the year I think we'll see a fairly firm market from a pricing perspective."

Ray Torto, principal and managing director of Torto Wheaton Research, compares this to "taking your foot off the accelerator just a bit" and expects it to have a minimal impact on cap rates and prices in the short term. He says the big issue, in the long term, will be how increasing rates changes the composition of the marketplace. He predicts it might lessen the current competitive marketplace as a higher rate environment might make private investors pause a bit on purchases.

The previous rate of 1% was the lowest level in more than 40 years. The move in interest rates came Wednesday afternoon with a unanimous vote by the Federal Open Market Committee, led by chairman Alan Greenspan. According to a statement released by the Federal Reserve, "the committee believes that, even after this action, the stance of monetary policy remains accommodative and, coupled with robust underlying growth in productivity, is providing ongoing support to economic activity."

"With underlying inflation still expected to be relatively low, the committee believes that policy accommodation can be removed at a pace that is likely to be measured," the statement adds. "Nonetheless, the Committee will respond to changes in economic prospects as needed to fulfill its obligation to maintain price stability."