Archive

Small multifamily owners will see more favorable terms as lenders compete. The small-balance multifamily market is well-positioned going forward due to strong investment activity and a vast improvement in liquidity this cycle, largely in part due to agency support. Loan size limits will increase slightly, certain programs will become more streamlined and new lenders that More

Count on multifamily developers to be highly selective with projects going forward as they store up dry powder for the beginning of the next real estate cycle. More people are looking over their shoulders as the 10-year-long economic expansion continues. Development veterans will seek out less new opportunities going forward as they sharpen the saw More

Retail borrowers will see available capital from banks, life companies and conduits.  High-quality sponsors that invest in best-in-class assets with compelling locations in markets with strong job growth will have their choice of non-recourse capital at historically low interest rates.  Lenders seek properties occupied by the highest quality retailers deemed internet-proof such as grocery, pharmacies More

Small-balance multifamily lending will grow as the capital markets remain liquid and lenders scramble to get money out the door.  The small-balance multifamily space is well-positioned due to strong investment activity and a vast improvement in liquidity this cycle, due in large part to agency support.  Loan size limits will increase slightly, certain programs will More

Property managers will go all out to bring fresh blood to the multifamily industry and focus even more on keeping their best employees. With the low unemployment rate and new developments coming online, operators need all the help they can get. Keep an eye out for salaries to creep up as the pool of experienced More

Watch for parking to be heavily scrutinized more often by developers as both land costs and construction costs remain high. Parking is expensive to build and requires a lot of valuable real estate. While the demand is still there, the cost to build is only increasing. Due to sizing constraints for urban sites, most firms More

Converting older buildings into apartments will draw in patient equity investors like moths to a flame. Adaptive reuse deals transform functionally obsolescent office, retail, factory buildings, etc., into apartments by creative sponsors. These opportunistic situations will attract equity dollars as they are some of the few multifamily deals out there that consistently yield high-teen and More

Everyone is wondering how much longer this current economic cycle can last.  Will it be a black swan event?  The end of Libor?  An interest rate increase?  Or will it mirror Australia’s 20-plus years of stability?  Most seem to agree that unless some unforeseen event happens, there will not be a downturn for at least More

Count on regional and local banks to pick up steam during the second half of the year, especially as the big banks put more focus on their existing relationship borrowers.  This leaves room for regional and smaller players to grab attractive deals.  Market growth will also allow banks to increase their lending over thenext few More

Borrowers will see plenty of financing options for self storage this year.  In the past, lenders looked at this property as specialized, but that view has changed.  More lenders will look toward self-storage as they move away from the four main food groups.  Too much competition in multifamily and industrial and less favorable demographics in More

There will be ample liquidity in the construction lending space from banks, debt funds and select life company lenders.  Banks will compete on pricing and be more disciplined on leverage during the second half of the year.  Keep an eye out for more non-bank lenders to enter the construction lending game.  This increased competition will More

The drop in interest rates fired up value-add buyers, causing cap rates to fall even further. While there are slightly fewer groups aggressively targeting only value-add deals (particularly in Texas due to real estate taxes), competition has grown even fiercer. Hard money acquisitions at contract signing are becoming more frequent. The combination of high-net-worth capital More