The commercial real estate market in New York City is set to see a big surge, a major investment firm based in the city is projecting.

It comes from KPG Funds, which sees property values, particularly in the next 12-18 months, skyrocketing between 50 and 60 percent. CEO of the company, Gregory Kraut, said that anticipated lower interest and demand for premium office spaces in The Big Apple is expected to lead the charge.

With the stock market tanking, and unemployment rising for the fourth consecutive month, it might be fair to expect multiple rate cuts implemented going forward by the Federal Reserve. That will of course lower cap rates. In the next 12 months, KPG, which invests in the transformation of properties into office spaces in the CRE market, estimates the central bank to reduce rates by 200 basis points in the next year.