Lendlease Global Commercial REIT – Cost of borrowing peaks

Announcement comes after rising global interest rates

Lendlease Global Commercial REIT (Lendlease REIT) announced today that its cost of borrowing has peaked as a result of rising global interest rates. Lendlease REIT's cost of borrowing has been trending upwards in recent months, in line with the global trend of rising interest rates. The REIT's cost of borrowing is now at its highest level since 2008.

Reasons for increasing borrowing costs

The increase in Lendlease REIT's cost of borrowing is due to a number of factors, including the rising cost of funds for banks and other lenders, as well as the increased demand for loans from other borrowers. The global economy is currently experiencing a period of high inflation, which has led to central banks around the world raising interest rates in an effort to control inflation. This has in turn led to an increase in the cost of borrowing for banks and other lenders.

Impact on the REIT's financial performance

The increase in Lendlease REIT's cost of borrowing is likely to have a negative impact on the REIT's financial performance. The REIT's interest expense is expected to increase in the coming months, which will reduce the REIT's distributable income and potentially lead to a decrease in the REIT's distribution per unit.

Outlook for interest rates

The outlook for interest rates is uncertain. Central banks around the world are expected to continue raising interest rates in the coming months, but it is unclear how high interest rates will rise and how long they will remain at elevated levels. The path of interest rates will depend on a number of factors, including the global economy, inflation, and the actions of central banks.

Conclusion

The increase in Lendlease REIT's cost of borrowing is a concern for investors. The REIT's financial performance is likely to be negatively impacted by the increase in interest expense. Investors should monitor the REIT's financial performance closely in the coming months to assess the impact of the increased cost of borrowing. Investors may also wish to consider diversifying their investments to reduce the risk of losses in the event that interest rates continue to rise.