Market, Industry Rallies After Fed Rate Cut

(Read more on the debt and equity markets.)

WASHINGTON, DC-Yesterday’s decision by the Federal Open Market Committee to lower its target for the federal funds rate by a larger than expected 50 basis points to 4.8% has buoyed spirits within the commercial real estate industry with lenders and brokers predicting a loosening, if only slight, in the credit markets. This unexpected dollop of liquidity, the hope is, will translate into a more favorable investment and leasing climate.

“This will boost the market’s mood considerably,” Matthew McManus, chairman of BlueStone Real Estate Capital, a real estate investment bank, tells GlobeSt.com. “Even today [the day after the cut was announced] lenders are sending signals that they might be more willing to look at real estate deals.” McManus says he began receiving emails and phone messages from lenders shortly after the rate cut was announced stating that it would be a big help. “There is no downside to a rate cut,” he says.