The US economy is oscillating between an upper boundary imposed by high real interest rates and the support provided by a resilient consumer. Overall trends reflect modest cooling of economic activity and declining inflation.
Following several years of strong inflows of debt and equity, Commercial Real Estate (CRE) assets lost investor attention as the interest rate hiking cycle gained steam. Risk aversion toward CRE investments brought about a steep decline in investment sales and difficult price discovery, which we are still experiencing. The loss of capital and confidence, with a backdrop of high borrowing rates, pushed capitalization rates higher and depressed values.
HOULIHAN LAWRENCE COMMERCIAL TEAM
Commercial real estate is entering a challenging period as low-interest rate maturities start to come due. Interesting commercial real estate investment opportunities will likely become available, but investors must be prepared to evaluate and make decisions expediently. Given consumer and market changes brought about by the intense period of change we have experienced after Covid, it is very important to correctly assess the numerous market and economic risks that add to the complexities of acquiring commercial real estate. Understanding the market forces that are shaping the fundamentals for each property requires a deep knowledge of the property, local and regional insights, and close contacts with the right financial partners.
Our Team is highly skilled in all these areas. Reach out to HOULIHAN LAWRENCE COMMERCIAL for a complimentary assessment of your real estate, an evaluation of a purchase target, and to receive an in-depth perspective on the ever-changing Westchester commercial real estate market.
