"Higher for Longer" Interest Rates: Persistent high interest rates increase CTO Realty Growth's borrowing costs, impacting its profitability and new acquisition financing, and making alternative fixed-income investments more appealing than preferred stock.

Inflationary Pressures: Elevated US inflation (currently 3.3%) reinforces the 'higher for longer' rate environment and can increase operating expenses for the REIT's retail properties, potentially affecting tenant viability and rental income.

Overall Economic Sentiment/Recession Risk: Global uncertainties like the Iran War escalation and oil price volatility contribute to economic caution. In such an environment, investor risk aversion can reduce demand for preferred stocks, which are junior to debt.