Ronald Dickerman: Industry's Spoiled Rotten, Fed Rate Hike Could Be Huge
Everybody’s waiting for the Fed’s decision on interest rates, which will be announced at 2 pm today. While economists are split, Madison International Realty founder and president Ronald Dickerman believes a rate increase could boost the commercial real estate industry for months to come. The low interest rate has been huge for the industry, Ronald says.
"We’ve all been waiting for the US economy to come out of low gear and get into medium and high gear in a world that has been very sluggish." Even with the Greek debt crisis and the Chinese stock market crash, Dickerman believes that the US economy has gained its footing and has even begun to grow. Ronald believes the commercial real estate industry—which he says has become "spoiled rotten" with low rates—could power through any rate increase due to the volume of capital in the sector and the strong recovery seen in gateway cities.
He says an increase would be a healthy thing for the industry, "to take a little bit of the subsidy, a little bit of the frothiness, out of the market." "That will help sustain the recovery, which benefits everybody." Whether or not rates are increased today, the Madison international boss expects a slow and steady increase in months to come. [GS]
