Fed’s Decision is Good for REITs

The Federal Reserve decided last week to hold off on increasing interest rates. The central bank hinted over the past few months that it might increase rates for the first time since 2008. The Evercore ISI REITs team, led by Steve Sakwa, conducted a survey last week to gauge investor sentiment following the Fed’s decision to not hike rates. Evercore ISI Analyst Jonathan Schildkraut explained that a majority of investors surveyed view the Fed’s decision as a modest positive because lower interest rates generally benefit real estate investment trusts. Remember, Crown Castle and American Tower converted to REIT status in 2014 and 2012, respectively.  “Over 85% of survey respondents expect the 10-year Treasury yield to be between 2 to 2.5% at year end, essentially unchanged from Friday’s close at 2.17%,” Schildkraut wrote.