A series of separate but unrelated economic, fiscal and monetary events are about to end the party, if one can call it that, for stressed and distressed owners of commercial real estate.
For starters, interest rates, which have been hovering at record lows, are expected to begin a slow but steady rise, possibly as soon as this month. This fear of rising rates has been a concern for the commercial real estate industry since the end of the financial crisis. The trigger, however, is finally going to be pulled, via the end of the Federal Reserve Bank’s controversial “quantitative easing” program, QE2, set for sometime in June.
Also currently coming to a head is the brewing debate over the debt ceiling. The rhetoric on both sides has already begun and is sure to reach bloodletting proportions by the summer months, with threats lobbed from both sides that are bound to rattle global finance markets.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
