Interest Rates Will Have Biggest Negative Impact on Commercial Property Values Say CRE Execs
July 7, 2015Most New York real estate professionals believe an interest rate uptick would be the most damaging event for property values, but many also think that external system shocks, ranging from slow growth in China to a Superstorm Sandy-sized weather event could hurt.
Nearly three-quarters (74%) of executives say an interest rate increase would have the biggest negative effect on New York commercial property values. But more than half (57%) said the slowing Chinese economy would have a negative impact, and even more (62%) said a weather event like a repeat of Superstorm Sandy would have a negative impact. That's according to the Spring 2015 Gotham Commercial Real Estate Monitor, a survey from accounting firm Marks Paneth of more than 100 New York commercial property owners, brokers, agents, engineers, accountants and lawyers specializing in the commercial space.
The survey shows that a number of executives are thinking about the impact -- both positive and negative -- of distant events.
"Interest rates are always a concern, but professionals are also increasingly concerned about the impact of sudden shocks and distant events," said William H. Jennings, Partner-in-Charge of the Real Estate Group at Marks Paneth. "They understand how complex the New York real estate market has become, and the degree to which distant and unexpected events can have a major effect on values."
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