Rising Interest Rates Trigger Primal Scream from Commercial Real Estate
A commercial real estate CEO is sounding alarms about the impact of rising interest rates on businesses and renters across America.
Jeff Sica, chief executive of Circled Square Alternative Investments, described what he called a 'primal scream from commercial real estate' after the Federal Reserve's latest move.
The underlying facts he cites are worth examining. The Federal Reserve raised interest rates to a target range of 3.75%-4.00% in its first rate hike in three years, with more expected.
Sica compared a 4% loan with a 7% loan and noted that the difference is about $600,000 per year extra in interest, according to his calculations.
The trillion-dollar refinancing figure he mentioned comes from an editor's characterization of the segment and has not been independently verified.