Real Estate Boom Will Continue Even if Fed Hikes Rates, Says Expert

The commercial real estate boom that’s sent rent prices soaring in places like New York and San Francisco this year won’t end even if the Federal Reserve raises rates this week, according to one expert. 'There's still massive liquidity. That liquidity is not going away any time soon, and it's pointed right at the United States, whether it be U.S. investors themselves or foreign investors,’ said Brian Ward, President of Capital Markets at Colliers International. Commercial real estate transaction volume in 2015 could approach the peak volume hit in 2007, right before the financial crisis, according to Ward, who expects volume will hit $500 billion this year. Ward said foreign investment has helped fuel the demand. 'Of the $500 billion, I wouldn’t be surprised if we saw roughly $50 to $60 billion coming from global sources, of which $10 to $12 billion could be Chinese,' said Ward. 'Now compare that to last year, the Chinese were at about $3.8 billion. So you can see just massive, massive increase from the Chinese, and really foreign capital in general.' Ward said the transactions have been led by deals in the industrial and multi-family sectors.