{"id":1004028682,"date":"2011-04-19T22:59:06","date_gmt":"2011-04-20T06:59:06","guid":{"rendered":"https:\/\/www.commercialsearch.com\/news\/?p=1004028682"},"modified":"2022-12-08T03:48:23","modified_gmt":"2022-12-08T11:48:23","slug":"time-to-be-thoughtful-about-interest-rates","status":"publish","type":"post","link":"https:\/\/www.commercialsearch.com\/news\/time-to-be-thoughtful-about-interest-rates\/","title":{"rendered":"Time to be Thoughtful about Interest Rates"},"content":{"rendered":"<p>By Paul Daneshrad, President &amp; CEO, StarPoint Properties L.L.C.<\/p>\n<p><a class=\"highslide\" href=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2011\/04\/P.-Daneshrad-New.jpg\"><img loading=\"lazy\" decoding=\"async\" data-attachment-id=\"1004028683\" data-permalink=\"https:\/\/www.commercialsearch.com\/news\/time-to-be-thoughtful-about-interest-rates\/p-daneshrad-new\/\" data-orig-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2011\/04\/P.-Daneshrad-New.jpg\" data-orig-size=\"1682,2355\" data-comments-opened=\"1\" data-image-meta=\"{&quot;aperture&quot;:&quot;0&quot;,&quot;credit&quot;:&quot;&quot;,&quot;camera&quot;:&quot;&quot;,&quot;caption&quot;:&quot;&quot;,&quot;created_timestamp&quot;:&quot;0&quot;,&quot;copyright&quot;:&quot;&quot;,&quot;focal_length&quot;:&quot;0&quot;,&quot;iso&quot;:&quot;0&quot;,&quot;shutter_speed&quot;:&quot;0&quot;,&quot;title&quot;:&quot;&quot;}\" data-image-title=\"P. Daneshrad New\" data-image-description=\"\" data-image-caption=\"\" data-large-file=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2011\/04\/P.-Daneshrad-New.jpg?w=731\" src=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2011\/04\/P.-Daneshrad-New.jpg\" alt=\"\" title=\"P. Daneshrad New\" width=\"214\" height=\"300\" class=\"alignright size-medium wp-image-1004028683\" srcset=\"https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2011\/04\/P.-Daneshrad-New.jpg 1682w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2011\/04\/P.-Daneshrad-New.jpg?resize=214,300 214w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2011\/04\/P.-Daneshrad-New.jpg?resize=768,1075 768w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2011\/04\/P.-Daneshrad-New.jpg?resize=731,1024 731w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2011\/04\/P.-Daneshrad-New.jpg?resize=1097,1536 1097w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2011\/04\/P.-Daneshrad-New.jpg?resize=1463,2048 1463w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2011\/04\/P.-Daneshrad-New.jpg?resize=150,210 150w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2011\/04\/P.-Daneshrad-New.jpg?resize=300,420 300w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2011\/04\/P.-Daneshrad-New.jpg?resize=696,974 696w, https:\/\/www.commercialsearch.com\/news\/wp-content\/uploads\/sites\/46\/2011\/04\/P.-Daneshrad-New.jpg?resize=1068,1495 1068w\" sizes=\"auto, (max-width: 214px) 100vw, 214px\" \/><\/a><\/p>\n<p>There is no question that commercial real estate values have increased over the past 12 months. But how has this happened? Have cap rates dropped and values increased because operating fundamentals have improved? Have rents increased dramatically or have your occupancy levels improved fundamentally? Is your 85 percent occupied shopping center now resting at 95 percent occupancy? The answer, amongst most of the property types in most regions, is a resounding \u2018no.\u2019 <\/p>\n<p>The correct answer lies in interest rates. Rates have dropped, debt has come back and the cap rate frenzy has taken off again. Today, utilizing a strategy of buying long term assets with a short term financing strategy is not only a mistake, but is fundamentally un-sound. We have multiple indicators and data that say interest rates are going to rise \u2014 and rise quickly \u2014 over time. <\/p>\n<p>The U.S. Treasury has been buying 70 percent of all of our government bonds for the past four months. Yes, a whopping 70 percent. Our debt is at unprecedented levels and growing at a current rate of $1.5 trillion a year, we have begun to monetize our debts because we want to keep interest rates artificially low\u2026 but for how long? <\/p>\n<p>Be careful, be thoughtful and let\u2019s not make the mistakes of years past.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>By Paul Daneshrad, StarPoint Properties L.L.C.<\/p>\n<p>There is no question that commercial real estate values have increased over the past 12 months. But how has this happened?<\/p>\n","protected":false},"author":1637,"featured_media":1004028683,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[37301],"tags":[],"class_list":["post-1004028682","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uncategorized"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.4 (Yoast SEO v24.6) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Time to be Thoughtful about Interest Rates - Commercial Property Executive<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.commercialsearch.com\/news\/time-to-be-thoughtful-about-interest-rates\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Time to be Thoughtful about Interest Rates\" \/>\n<meta property=\"og:description\" content=\"By Paul Daneshrad, StarPoint Properties L.L.C.  There is no question that commercial real estate values have increased over the past 12 months. 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