the Editors of Commercial Property Executive
M-F Mortgage Delinquencies Increase in Q1, Says MBA
The weakening economy and continued credit crunch led to increases in commercial/multifamily mortgage delinquencies during the first quarter of 2009, according to the latest Commercial/Multifamily Delinquency Report, released by the Mortgage Bankers Association. “Multifamily mortgage delinquency rates continued to rise in the first quarter,” says Jamie Woodwell, vice president of commercial real estate research at MBA. “Delinquency rates on multifamily mortgages held by banks and thrifts, by Fannie Mae and in commercial mortgage-backed securities (CMBS) are all now at levels higher than at any time since the 2001 recession. First quarter delinquency rates on commercial mortgages held by life insurance…
Economic Update – Pending Home Sales Reach for Unexpected Highs
The National Association of Realtors said Tuesday that its index of signed sales contracts, which is regarded as a harbinger of home sales in the very near future, spiked upward 6.7 percent nationally in April to 90.3. That much of a rise hadn’t been expected by analysts, and represented the quickest upward movement of the index since late 2001. A mixture of factors seemed to be driving buyers. Prices are down, first-time buyers have that $8,000 tax credit to spur them on, and until last week at least, mortgage rates were remarkably low. Regionally, the Northeast saw an enormous increase…
Buildings’ Weak Link: Energy Conservation Through Windows
When it comes to saving energy, windows constitute the weak link for buildings. Despite heavily insulated walls and ceilings and the popularity of low-e glass, 25 to 35 percent of the energy used in buildings and homes is wasted due to inefficient glass. In fact, it should come as no surprise that glass is responsible for greater than 10 percent of the total carbon emissions in the United States annually and is a major contributor to global warming.New technologies, however, can improve this picture—and they are acknowledged in initial revisions to the Department of Energy’s Energy Star® window performance standards,…
Steadfast Launches New Securities Division to Capitalize on Anticipated CRE Opportunities
With an eye on the impending onslaught of maturing debt in the real estate marketplace, Steadfast Cos. has just kicked off Steadfast Capital Markets Group L.L.C., a new securities and financial services division. The Newport Beach, Calif.-based diversified real estate investment concern’s new division will give investors the opportunity to join forces with the company and take advantage of the increasing opportunities presented by the existing real estate cycle. J. Grayson Sanders, former CNL Fund Advisors Co. president, has been tapped as CEO and will head up development of investment products and supervise sales and distribution activities. Aaron Cook (pictured),…
Financing Keeps Rolling in for Colonial
Despite the fact that widespread job losses have begun to take a toll on the multi-family market, owners of this asset type are still able to secure financing in what remains a frigid lending environment. Just three months after having wrapped up a $350 million secured credit facility, Colonial Properties Trust has landed another major financing deal with the closing of a new $156.4 million secured credit facility.Colonial’s latest credit facility, consisting of a $145.3 million tranche and an $11.1 million tranche, carries a 10-year term and features a 5.31 percent weighted average fixed interest rate. The REIT relied on…
Economic Update – Seismic Shifts in Auto Industry Have CRE Implications
Monday was an historic day in Detroit, and arguably for the entire U.S. manufacturing sector, even though GM’s formal announcement of bankruptcy, along with President Obama’s promise for more than $30 billionfor a company in which the U.S. Government will soon own a controlling interest, weren’t surprises . A little more surprising (only a little) was the quick approval by Chrysler’s bankruptcy judge of the sale of most of its assets to a group led by Fiat SpA, meaning that the Detroit automaker will continue to exist in one form or another, albeit with Italian bosses. But the fact that…
Capital Markets’ Distress Mingles with Hints of Improvement
Signs of growth in distressed properties are mixing with evidence that the U.S. and global real estate markets are starting to stabilize, according to a recent analysis by Jones Lang LaSalle Inc. The issue of distressed assets in the United States presents a contradictory picture. Loan defaults are at an 11-year high, and lenders and borrowers face the daunting prospect of refinancing commercial real estate loans valued at $1.3 trillion over the next four years. By April, the unpaid balance of CMBS loans in special servicing hit $24.5 billion, a total 10 times as high as it was in March…
For Private Equity Industry, Mortgage Financing Main Challenge on Horizon
With the economy in the tank and credit markets frozen, fund sponsors have plenty to worry about, but as Ernst & Young L.L.P. concludes in a new report, their greatest issue is mortgage financing and the capacity to refinance maturing debt on commercial assets over the next 12 to 18 months. “Maturity default, that’s what everyone’s worried about, not interim default,” Gary Koster, head of E&Y’s Real Estate Fund Services Practice, told CPN. In the report, entitled 2009Market Outlook – Trends in the Real Estate Private Equity Industry, three debt-related issues were cited among the top five leading strategic priorities…
Economic Update – Mortgage Rate Worries Weigh on Housing Market
General Motors was in the news over the weekend before the largest bankruptcy in U.S. history (that is, its own), but more worrying for many policymakers, economists and ordinary borrowers is last week’s sudden spike in mortgage interest rates. For the last few months, the Federal Reserve had used its considerable clout to drive mortgage rates to practically their lowest level since the introduction of Arabic numerals to the Western world, but movement in the bond market struck back last week, pushing rates from about 4.875 percent to about 5.5 percent. In an effort to whack that interest-rate mole again,…
Head of the Class: County-Level Education Data, Trend-Savvy Offer Valuation Guidance
Over the next several years, one of the most common questions in commercial real estate will be, “What’s that retail center really worth?” A first-quarter survey of distressed assets offers a clue as to how often that question will apply to underperforming assets. Through the first quarter, 1,276 retail properties were classified as distressed by Real Capital Analytics Inc. That is the most of any property sector and represents assets valued at up to $16.8 billion—second only to the $18 billion in distressed development properties tallied by Real Capital Analytics.To some extent, a combination of experience and anecdotal observation can…