Implications of the November FED Meeting
WHAT THE NOVEMBER FED MEETING MEANS FOR CRE INVESTORS
Fed Funds Rate Stays Between 5.25% and 5.50%
The Fed Funds Rate will remain flat in November, while Wall Street predicts no rate changes until 2024
However, The Fed also detailed plans to decrease long-term treasury issuance to aid longer-term treasury rates
What Climbing 10-Yr Treasury Rates Means For CRE
This is unlikely to spark a wave of distress, as long-term investors have likely recorded strong equity growth, making issues with maturing debt unlikely for these properties
In addition, The Fed has issued guidance on additional loan extensions for lenders with good credit standing
Who Will This Impact?
Investors who bought in 2021 and 2022 using variable rate financing or rate caps could feel pressure to sell
However, an abundance of capital is waiting on the sidelines and long-term demand drivers are positive, suggesting discounted pricing may not reach expectations
*Through November 01
Sources: Marcus & Millichap Research Services, Federal Reserve
