Chris Moore and Karolina Brzozka find solutions to reduce hedging costs on floating-rate debt in GlobeSt.com
Summary
Writing for GlobeSt.com, Chris Moore and Karolina Brzozka identify solutions for commercial real estate borrowers facing significantly higher premiums on interest rate caps.
For some structures, cap costs are as much as 20 times more expensive than they were a mere six months ago.GlobeSt.com
It has been an eventful few months in the interest rate markets, with commercial real estate borrowers facing a much steeper forward curve and increased market volatility, both of which have contributed to significantly higher premiums on interest rate caps. For some structures, cap costs are as much as 20 times more expensive than they were a mere six months ago.
That sticker shock has led to a very common question: what are some creative solutions to ease the burden of that upfront cap cost?
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