TAG Industrial Watch: March 22, 2025

Despite the efforts of President Trump to persuade the Federal Reserve to cut interest rates, our central bank kept the lending rate between banks at a range between 4.25 to 4.5 percent. Nonetheless, the Fed did take another step toward what TAG believes will be the ultimate outcome. The Fed announced that it would again scale back on its “quantitative tightening” program. In plain English, instead of reducing its holdings of U.S. Treasuries (purchased by inflating the money supply) by roughly $25 billion a month, the Fed will only shed about $5 billion monthly, relieving some upward pressure on interest rates.

On one hand, this move by the Fed allows the bank to maintain its tough image on inflation by keeping interest rates elevated. On the other hand, the bank will likely, at some point, resume its role as the largest lender to the government by inflating the money supply to purchase more Treasuries. Unfortunately, such a maneuver will probably lead to higher prices and higher interest rates throughout the economy. To industrial investors, the threat of stagflation can actually be a blessing in disguise. By owning specialized facilities like manufacturing shops, investors may be in a position to push rents high enough to keep pace with the Consumer Price Index, without fear of losing their tenants to a vacant warehouse next door. By essentially creating a real estate inflation hedge, investors may not only maintain their property’s value but enhance it.

I N D U S T R I A L   N E W S

Trump Urges Rate Cuts As Powell Warns Of Tariff-Driven Inflation
GlobeSt.com – March 20, 2025
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Fed Stays Put On Interest Rates, But Uncertainty Looms
Commercial Property Executive – March 19, 2025
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Fed Holds Interest Rates Steady
Connect CRE – March 19, 2025
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The Supply Wave: Industrial Moves To Stabilization
REjournals – February 26, 2025
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Harold Hamm: “Drill, Baby, Drill” Needs $80 Oil
ZeroHedge – March 19, 2025
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R E G I O N A L   N E W S

Americold Acquires Baytown Industrial Facility
Connect CRE – March 18, 2025
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Sterling Bay, Affinius Capital Complete
Pulaski 55 Logistics Centre In Chicago
REjournals – March 12, 2025
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Griffin Partners, Peakline To Develop 224,700 SF
Industrial Project In South Houston
REBusiness – March 20, 2025
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Sterling Bay Secures $88M For Denver-Area Mixed-Use
Commercial Property Executive – March 12, 2025
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Colorado Industrial Contractor Awarded
$12M Contract At Chicago O’Hare
Mile High CRE – March 20, 2025
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