Defeasance Hedging

Markets have the potential for large swings given the current unstable economic situation. For example, on June 4 of this year, we saw the five year U.S. Treasury rally (higher prices, lower yield) 17 basis points in one day when the market received disappointing jobs data. If you had to purchase $5 million of that security for your defeasance the cost would have increased approximately $40,000 from the day before.



These swings in bond prices can negatively impact the economics of your real estate transaction, if you don’t hedge against them. If price fluctuations concern you, Commercial Defeasance’s affiliate, Custom Hedging Solutions, LLC, can help you protect against this risk and preserve the economics of your real estate transaction.

Contact us today for more information.