NEW YORK CITY-While political and economic uncertainty generallyare taking a toll on investment sales activity, no factor iscreating more sleeplessness than what will happen to interestrates. The future course of interest rates—how soon, how rapidlyand how far they rise from the current historically low rates—is“the elephant in the room,” panelist Warren DeHaan, chief originations officer and managing director atSPT Management LLC, told a RealShare New Yorkaudience Tuesday. For his part, Michael Cohen,president of the tri-state region for ColliersInternational, foresaw a “continued conspiracy” on thepart of the Federal Reserve to keep interest rates low for the timebeing, regardless of who’s elected President next month.

All of the panelists during Tuesday’s “Transactions Outlook”panel at the Grand Hyatt in Midtown, moderated by FaithHope Consolo, chairman of the retail group atPrudential Douglas Elliman, had plenty to sayabout government’s influence on the outlook for either sales orleasing. Patrick Robinson, president of the Northeast region atTranswestern, said we’re currently seeing “the calm before thestorm” that may set in with election results. Cohen said that whenit comes to the effects that the legislative/regulatory environmenthas on CRE, “the devil is in the details”—and there are few detailsavailable.

One area in which the industry has little to go on is thecapital gains tax rate, and there isn’t likely to be clarity untilafter the election. Should Barack Obama win re-election, Cohenpredicted, we could see a flood of product hit the market beforethe year ends.