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Rising Treasury yields strain commercial real estate financing
On Sept. 23, the 10-year Treasury yield hit 5.1% and the 30-year reached 5.4%, while the Fed also lifted its funds rate to 3.75% to 4% this month.
Commercial Observer reports that surging borrowing costs are pressuring commercial real estate, with the latest move in long-term Treasury yields raising concerns about deal financing and refinancing conditions.
On Sept. 23, yields on the 10-year and 30-year Treasuries hit their highest levels in 19 years, with the 10-year at 5.1% and the 30-year at 5.4%, levels last seen just before the Global Financial Crisis runup in July 2007.
The article also links the spike to earlier Federal Reserve action, noting that on Sept. 16 new Fed Chair Kevin Warsh announced a quarter point increase in the federal funds rate to a range of 3.75% to 4.0%, a hike the outlet says was unanimously voted 12-0 by the Fed board of governors.