More stories

  • in ,

    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

  • in ,

    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

  • in ,

    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

  • in ,

    Self storage locks down lenders

    Expect self storage to be a favored asset class this year. There is a need for self-storage space in many markets and occupancies are not expected to soften anytime soon. Lenders like the fact that this property has consistent demand throughout the good times and the bad. Self storage is still one of the top performers in the commercial space with very few losses experienced by lenders. Certain markets could experience some overbuilding, but lenders will work to keep developers in check and lend to markets that show a need for additional space. More

  • in ,

    Equity will get a jolt during the second half of the year

    JV and pref equity deals will continue to be difficult for the first part of the year as many investors remain on the sidelines. Rising rates have caused floating-rate debt to be above most cap rates, resulting in negative leverage. Some JV equity providers have shifted their focus to the debt side or will invest as pref equity only. There has not been a lot of acquisition equity being placed and a huge pullback in ground-up development is occurring. However, it is not all doom and gloom. Whispers are that the Fed plans for at least three rate drops this year and once that happens, there will be more activity. More

Load More
Congratulations. You've reached the end of the internet.