The Federal Reserve just increased its benchmark interest rate by a quarter point. This is the second time interest rates have increased in three months.
What does this mean if you’re planning a project? According to Mark Mitchell, our Director of Project Development, it is best to arrange for financing early. “A fluctuation of just a point or two can significantly impact your overall project costs. For example, a rise of one percentage point in interest can increase the carrying costs on a $1,000,000 project by $10,000 in a year. With anticipated rate increases again this year, the sooner you lock in your financing the better interest rate you are most likely to receive.”
However, a slight increase in interest rates is generally not a deal breaker. “Most clients are looking at any opportunity to receive the best overall value on a project.” Mitchell indicated, “and a bump in the cost to borrow money may just mean some other part of the project needs to be trimmed.”
When you work with Derrick Building Solutions, the design-build process is all about finding your best value including the total cost of ownership. “It’s still a great time to build,” says Mitchell, “and many companies and organizations continue to take advantage of good market conditions to upgrade and expand their facilities.”
To learn more about how you can get started with your design-build project sooner, contact Derrick Building Solutions at 715-246-2320, or use the form at the right to request a no-cost consultation.