An emerging sentiment in the real estate industry is that interest rates are settling into a "higher for longer" environment. This was voiced during a recent virtual roundtable hosted by Institutional Real Estate, Inc., featuring institutional investors, consultants and investment managers, and moderated by Loretta Clodfelter, editorial director with IREI.
Participants indicated a desire for interest rates to top out and stop increasing, so uncertainty ceases, which is what is hurting the market. Another noted that achieving returns in the current market is challenging because of the impact that higher interest rates have had on the capital stack.
The discussion also delved into the substantial growth in debt-related investments. Industry participants had different perspectives on debt and its implications, with some expressing concerns about the debt market and others discussing potential opportunities. Without an active transaction market, refinancing existing assets
