Q: Can I please have your opinion on the impact of interest rates on FirstService in general. Do you feel they would have anything other than the average market reaction to interest rate changes, either rising or falling? Thank you.
5i Research Answer:
The property management business is closely tied to real estate, and real estate is closely tied to rates, so we would assume FSV has more rate sensitivity than most companies. It has $1.4B in debt/obligations and paid $56M in interest expenses in the last 12 months, so there is a direct fundamental impact from rates as well.