While many US Corporations have been increasingly forcing their workers back to office, it seems that the hope for US Office Commercial REIT to rally closer to their NTA value per unit relative to the current depressed market trading price maybe dashed soon. The upside factor of interest rate cut and back to office mandate by the US Federal government and CEOs of US global corporations are being offset by the termination of office leases from rapid downsizing of the Federal government.

1. Interest Rate Cut by the Fed in 2024 Reduces Financing Pressure on Commercial REITs 

The 0.5% cut in September followed by subsequent cuts of 0.25% respectively in Nov 2024 and Dec 2024 brought down US financing rate by about 1% overall. This also makes it more conducive to borrow funds either for CAPEX or purchase of commercial building.]

2. Weaker Bargaining Chip of Workers Due to Increasing Signs of Softness in US Labour Market

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