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Property Investment Advisor Brian Fielding Responds to the..

For more information about commercial real estate investment and answers to common questions, visit http://fieldinginvestments.com

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Property Investment Advisor Brian Fielding Responds to the..

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  1. FieldingInvestments.com PropertyInvestment AdvisorBrian FieldingRespondstothe article, “U.S. Treasury Market GoesOff Script.” TheWallStreetJournalrecentlyreportedtheShort-andLong-TermYieldshavenarrowed,causingreal estate adviserBrianFieldingto note the possible effectsoncommercialreal estate investments. Mr.Fieldingexpressedconcernthatthenarrowingoftwo-yearandten-yearratessuggeststhattheinvestmentcommunityexpectstheFederalReserveratetoincreasesometimewithinthenextyearorso. “Forthose personsoutthereseekinginvestmentproperties,theyshouldkeepinmindthattherecordlowinterestratesmaybemovingupward,andthus,changetheformulaicreturnthatinvestorsmightbeprojectingfortheirpurchases,”sharedBrianFielding.“WheninvestorslookatNet-leasedinvestmentsbeingsoldatcapratesfromthemidfour’stobarely overseven percent,evenamodestblipinthecostofmoneycanhaveadramatic effectonprojectedreturns.” Hewentontoexplainthatfewinvestorsactuallypayallcashfortheirinvestmentpropertyandoftenhavetotakerelativelyshort-termborrowingstomeettheirinvestmentgoals.Butifthatmorespeculative “short-term”investorfailstoquickly“flip”thatasset, he may findthatthecombinationofhighermortgageratesandshorterremainingtermonthenetleaseleadstoadangerouscocktail,butaverygoodopportunityforwell-heeled,re-purchasers.Mr.Fieldingsuggeststhatinvestorstakealong-rangeapproachwhenbuyingcommercialrealestateandtherebylimittheriskofachangeininterestratesputtheirreturnatrisk. “Infact, we recommendthatthosewhoplantopurchasesometime withinthenearfuturestartbuildingrelationshipswiththeirlocalbanksandthecommerciallendingbrokerstobegintheprocessofbuildingaprofessionalrelationshipthatcanhelpthemtrackinterestratemovementandbemorereadytopurchaseshouldauniqueopportunitypresentitselfbutrequireafasterclosing,”shares property investmentadvisorBrianFielding.

  2. FieldingInvestmentstracksactionsbytheFederalReserveclosely,feelingthatnotonlydoesitsactionslargelydeterminelong-terminterestrates,buttheremaybenobetterwaytotrackpendinginflationandmeasuretheoverallstrengthoftheeconomy–importantissueswhenmakinglong-termeconomicdecisions.FieldingInvestmentstracksactionsbytheFederalReserveclosely,feelingthatnotonlydoesitsactionslargelydeterminelong-terminterestrates,buttheremaybenobetterwaytotrackpendinginflationandmeasuretheoverallstrengthoftheeconomy–importantissueswhenmakinglong-termeconomicdecisions. FieldingInvestmentsprefertoownacarefulmixofnet-leasedretailandofficeassets,whichthecompanybelievestobeintegralinitseffortstobalanceitsportfolioswithbusinessesthatprosperinastrongeconomy,aswellasthosethataremostlikelytobenefitfromthereverse. “We try tomaintainaportfoliowithtenantsthatweexpecttodowellinadowneconomysuchasperhapsWal-Martandthevarious‘DollarStores,’withthosethatseemtoprosperwhenconsumingspendingis strong,”sharesBrian Fielding.“Weremainunconvincedthatoureconomyisontheroadtofullrecovery,butthatdoesnotdampenourenthusiasmfortheownershipofcommercialproperties;itmerelymakesuslookmorecloselyatourholdingsintheefforttomaintainatenantmixthatwefeelbestbalancesourlikelyfuturerevenuestreams.” Formoreinformationaboutcommercialrealestateinvestmentandanswerstocommonquestions,visithttp://fieldinginvestments.com.

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