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    Retail is now becoming a favored property type

    Retail borrowers will see more available capital as lender appetite will be stronger this year. Many point to retail as a top asset class since multifamily and industrial both face some hurdles. Lenders are confident in the fact that rents have been up across the board. Retail has seen an increase in rents and decrease in vacancies, along with massive demand. There is also limited new supply entering the market. Grocery-anchored centers will continue to see the most attention, although watch for lenders to start looking at other retail properties this year. More

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    Multifamily owners will see more available capital

    Multifamily lending will be more borrower friendly during the second half of the year as rates start to come down. Lower rates will help spur activity and simultaneously reduce the impact of the large pool of loans set to mature with current rates at least 1.5% below the current interest rate environment. Look for a continued focus on strong sponsors and well-performing markets, with the agencies reclaiming their historical market share levels. While banks and life companies will be some of the most attractive options, CMBS lenders will become more popular because of decreased spreads. More

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    Banks will increase activity as the year progresses

    Expect bank lending to continue on the same trajectory during the first two quarters this year, with some improvements in Q3 and Q4 following the Federal Reserve lowering the overnight lending rates. As the year progresses, more and more banks will re-enter the market for new borrower relationships. Banks will especially be drawn to acquisitions with fresh equity coming in and where there is a resetting of the property value. Refinances will be more challenging because of higher rates. Banks will be really focused on sponsorship and borrower relationships. More

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    Deal of the Week: Single-Tenant Net Lease property in Columbus, Ohio

    The tenant on this STNL deal is Liberty Dialysis. The lease was guaranteed by Fresenius, an investment-grade tenant rated BBB by S&P. The 7,600-s.f. property was built in 2015. The Class B asset was owned free and clear. The borrower wanted a non-recourse or limited recourse loan for the maximum possible term. Many lenders have a policy against cash out. If the loan amount was $1, it was a cash-out event. Bison Financial Group, who arranged the deal, needed to find a lender that was comfortable with this fact pattern and based the loan on the value of the property. More

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    Land lending sees light at the end of the tunnel

    Land lending will improve as rates begin to decline later this year, making take-out construction financing more viable. Expect more available capital as the year progresses with interest rates declining. Keep an eye out for more lenders entering the market as things improve. The majority of unentitled land deals will have to be with the debt funds as some banks remain on the sidelines. More

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