News October 24, 2024

Property Market’s ‘New Cycle’ on Hold as Rates Climb, Zegen Says

Bloomberg reported that a sudden rate climb in recent weeks is creating more uncertainty in the commercial real estate market and causing some investors to pause dealmaking, according to Madison Realty Capital co-founder Josh Zegen. “It started to feel like we were at the bottom and it was the turn of a new cycle, but the backup in Treasuries right now in the last week has put a pause on institutional real estate investors and investors as a whole,” Zegen said Thursday in an interview on Bloomberg Television. In recent weeks, yields on US 10-year Treasuries have increased as stronger-than-expected economic data cast doubt on how much more the Federal Reserve can cut rates. “The fact that this has now put a pause on the market, or a reluctance to commit to new deals, is a challenge.” “There’s still a perception rates will be coming down, but the question is, at what pace and how much?” Zegen said. “There’s a lot of uncertainty in the market and some are saying, ‘Why commit now? Am I being rewarded for being early in the cycle?’”

Read Full Article