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Fordham University, Business Council of Westchester Host ‘Economic Outlook and Forecasting the New York Region’s Real Estate Market’


Market leaders share insight on impacts of rising interest rates, inflation and global uncertainty

NEW YORK, NY / ACCESSWIRE / September 12, 2022 / Top minds in real estate, economics and finance shared insight into how rising interest rates, inflation and economic uncertainty are impacting commercial real estate in New York, the U.S. and markets abroad as part of a virtual panel discussion Sept. 7 hosted by Fordham University’s Real Estate Institute and The Business Council of Westchester (BCW).

“Economic Outlook and Forecasting the New York Region’s Real Estate Market” featured Kathleen Corton, CEO, CIO and managing partner, Hillcrest Finance LLC; Eamonn D’Arcy, professor of International Real Estate, Henley Business School, England; Christopher Deutsch, vice president, China CITIC Bank International Ltd.; Charles Dougherty, vice president and economist, Wells Fargo; Timothy M. Jones, CEO, Robert Martin Co.; and Nicole LaRusso, senior director for research and analysis, U.S. North Region, CBRE Group Inc. The panel was moderated by BCW President and CEO Dr. Marsha Gordon.

Corton, of Hillcrest Finance, talked about how different property types are being impacted in the current environment. “I look at it two ways – what happens on the revenue side and what has happened with the cost of capital,” Corton said. “For multifamily, rents are up across the board. Very positive news on the top line, but the cost of capital has gone up as well. So, values on multifamily are down, not by a lot, but they’re down. Office values have gone down a lot, and it’s very difficult to refinance. Industrial, fundamentally, is very strong and probably the darling of the capital markets.”

Deutsch, of China CITIC Bank, also is seeing decreasing capital on the debt side, and explained how banks are addressing interest rates and reserves for construction loans. “Banks decrease debt levels by using an interest reserve or calculated interest reserve for a construction project, so they know they’re getting paid over the course of the loan,” he said. “They calculate that reserve and step it up every six months or year, based on their models. Now, we’ve gone from a quarter point to the Fed saying step it up three-quarters of a point. A lot of reserves are being recalculated and borrowers are being asked to fund it … that sucks capital out very quickly.”

The panel also shared insights into remote-work trends and how that is reshaping real estate. CBRE’s LaRusso said that, pre-pandemic, the average office worker spent about 4.2 days a week in the office. Now she expects it will be 3.2 days. “The reduction in time spent in the office, combined with current economic uncertainty and higher costs for occupiers, is going to push back on office demand in the near term,” she said.

Henley Business School professor D’Arcy said that in London, “we’ve discovered people are in the office on Wednesdays, and also Fridays because they like socializing,” and noted the busiest day on the Tube is Saturday – indicating people are prepared to go out socializing but maybe not to go to work.

“Understanding the way people are living, working and spending their leisure time is important not just for commercial real estate, but for the way we develop our programs at the Fordham Real Estate Institute,” said Dr. Anthony R. Davidson, dean, Fordham University School of Professional and Continuing Studies. “How we live is changing, and education must continually evolve to meet those changes.”

Those changes also bode well for Westchester, said Gordon, noting “a real opportunity to capitalize on the shifting needs of people and businesses.”

“The hybrid work format presents great growth potential for developers, banks and other businesses in Westchester County to lead the way in ensuring our infrastructure, transportation, working and living spaces are adaptable to the new type of work/lifestyle,” Gordon said.

Jones, of Robert Martin, noted the industrial sector benefitted from the e-commerce boom and multifamily profited from the work-from-home shift. Office and retail/entertainment spaces were heavily impacted, he said, but both are rebounding. “Office space has changed enormously, especially space that people have to commute to,” he said. “Office space in New York City is physically about 40 percent occupied now. In Westchester, our industrial spaces are fully occupied, but office remains at pre-pandemic levels, which is a relatively stable 20 percent vacancy level. Retail is doing better, and multifamily continues to be very strong.”

Gordon asked the panel how the pandemic-fueled migration from expensive cities, like New York, to the suburbs has impacted local office markets, including in Westchester.

“The good news for Westchester was that many of those who left (NYC) didn’t go far,” said LaRusso. “Many found themselves in Westchester and other parts of the suburban tri-state market. As a region, we did a decent job of holding onto our workforce and we saw that play out a little bit in leasing activity in suburban markets.”

The panel weighed in on expectations for interest rates and what a recession could mean for real estate.

“Interest rates are going to continue to rise and that’s going to slow down activity across the economy, which is likely to have a big impact on commercial real estate,” said Dougherty, of Wells Fargo. “Higher interest rates are one thing, but when you have demand for commercial properties slow considerably, that is going to slow down rent growth and cut into property valuations.”

Dougherty added a recession is likely in 2023 and will further impact the commercial sector, particularly hospitality in New York City which is waiting for international tourism to come back. “A very strong U.S. dollar coupled with a recession and probably an even more pronounced downturn in Europe is going to have a big impact on New York’s hotel market,” he said.

D’Arcy offered dire predictions on inflation. “The Bank of England, in August, was talking about inflation peaking next year at 13 percent. We’re currently at 10.1 percent and a prediction from Goldman Sachs suggests we could hit 22 percent, which is horrendous, by sometime next year.”

To view the event, click here.

About Fordham Real Estate Institute

Fordham Real Estate Institute offers a Master of Science degrees in Real Estate, Real Estate Development, and Construction Management, a Bachelor of Science in Real Estate, and a comprehensive array of advanced certificates in real estate and construction at its campuses at Lincoln Center, London Centre and online. Serving professionals and owners/investors of all stripes, the MSRE curriculum presents the essential elements of real estate finance, investment, development and management. The programs are developed and taught by leading industry practitioners and are centered on imparting real-world professional skill sets. Flexibility and convenience are program hallmarks as classes can be taken in-person, online, and at various paces. REI is a part of Fordham’s School of Professional and Continuing Studies. For more information, visit

About The Business Council of Westchester

The Business Council of Westchester is the county’s only business membership organization focusing on economic development and advocacy. It is the county’s largest and most prestigious business membership organization representing more than 1,000 members, including multinational corporations, hospitals, universities, biotech pioneers, not-for-profits, entrepreneurs and companies of all sizes. As the most influential economic development and advocacy organization in Westchester, The Business Council of Westchester’s members enjoy unparalleled access to today’s top thought leaders, diverse business development opportunities and lawmakers at all levels of government. The BCW Data Exchange provides the latest demographic research to help guide smart business decisions. The LEAP program, a one-of-a-kind initiative, gives members direct access to lobbying efforts at the county, state and national levels on issues that directly affect their businesses. Build, Connect and Win with The Business Council of Westchester. Visit to connect today.

Fordham Real Estate Institute, Monday, September 12, 2022, Press release picture

Participating in the Sept. 7, 2022 panel, “Economic Outlook and Forecasting the New York Region’s Real Estate Market,” were (top row, from left) Kathleen Corton, CEO, CIO and managing partner, Hillcrest Finance LLC; Dr. Marsha Gordon, president and CEO, The Business Council of Westchester; Eamonn D’Arcy, professor of International Real Estate, Henley Business School, England; and Nicole LaRusso, senior director for research and analysis, U.S. North Region, CBRE Group Inc. (Bottom row, from left): Christopher Deutsch, vice president, China CITIC Bank International Limited; Charles Dougherty, vice president and economist, Wells Fargo; and Timothy M. Jones, CEO, Robert Martin Co. LLC.

Media Contact: Fordham University

Caryn McBride, Co-Communications Inc.
[email protected]

SOURCE: Fordham Real Estate Institute

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