Business Specialties

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…

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…

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,…

The tsunami of residential foreclosures may have started, back in the days of easy mortgage money, with borrowers whose only qualification was being able to fog a mirror. About half of those kinds of subprime mortgages have resulted in a foreclosure outcome, and Alt-A-inspired foreclosures are spiking too. But now, according to the Mortgage Bankers Association, foreclosures on prime fixed-rate loans represent the largest share of brand-new foreclosures. Currently about 6 percent of all prime mortgages are at some point in the foreclosure process, twice as many as a year ago. Four states account for nearly half of the prime…

After the stock market’s strong performance on Tuesday, some worrisome economic figures put a damper on the party on Wednesday. The National Association of Realtors has pegged the nation’s unsold housing inventory–including single-family, townhouses and condos–at 3.97 million units in April, or roughly a 10-month supply at the current slow-mo sales pace. Unsold residential inventory hasn’t been that high since last November, noted the organization. Not that sales are down. In April, housing sales were up 2.9 percent from March, according to the NAR, spurred by prices considerably off peak, perhaps even down to 2003 or 2002 levels in some…

Happy days are here again? Or maybe the American consumer isn’t quite that optimistic, but instead is simply glad things don’t seem to be getting a lot worse. In any case, the Conference Board reported on Tuesday that its index of consumer confidence shot up in May to 54.9 from a revised 40.8 in April, marking the largest one-month jump in the index since April 2003. Wall Street, which had something of a lackluster week before Memorial Day, evidently decided that Main Street’s optimism was a cue to buy. On Tuesday, the Dow Jones Industrial Average was up 196.17 points,…

Various tax holidays got under way over the Memorial Day weekend, or will get under way shortly, possibly giving a nudge to retail sales in some places. In Texas, for example, Memorial Day weekend was the second annual Energy Star sales tax holiday, with certain Energy Star rated appliances qualifying for tax-free status, such as air conditioners, refrigerators, ceiling fans, light bulbs, clothes washers and dishwashers. In Virginia, the Hurricane Preparedness Sales Tax Holiday begins May 25 and runs to May 31. During that period, there will be no state or local taxes on a variety of items associated with…

The special-purpose entity structure that has helped to power real estate finance in recent years remains intact after recent court decisions tied to the General Growth Properties Inc. Chapter 11 bankruptcy filing. However, the rulings may turn out to be less than a total victory for bondholders in the long run. In a research note published Thursday, Fitch Ratings argues that the cost of defending bondholders’ positions will take a toll on subordinate bonds and limit the control over the process usually enjoyed by special servicers. “Positions taken by GGP to date lead Fitch to believe that certain CMBS bondholder…

Plenty of investors are preparing to benefit from the coming wave of distressed asset sales, but net lease investors are not unanimously enthusiastic about the prospects. As net lease investors weigh whether to adopt an opportunistic approach, some veteran players are sticking to longtime conservative strategies. In that debate, AEI Capital Corp., a 39-year-old firm specializing in net-lease retail assets, makes the case for buying only successful stores tenanted by proven national brands.“Over the last couple of years, people lost track of the basics,” contended George Rerat, vice president of acquisitions. Net lease specialists, like many other investors, often failed…