Commercial Mortgage Lending - Liberty Realty Capital Group

CMBS Lenders Scramble to Comply With Looming ‘Risk Retention’ Rules

June 24, 2016 by Randybaconin Commercial Mortgage Lending, Real EstateLeave a Comment

Analysts Say New Round of Financial Oversight Rules Governing Loan Risk Could Affect Lending Rates, CMBS Volumes

New financial oversight regulations set to go into effect later this year will require lenders originating CMBS loans to include “skin in the game” by retaining a 5% slice of each CMBS deal for five years.

The new rules going into effect Dec. 24 are raising concerns in a CMBS market already reeling from a year-to-date 50% decline in overall issuance from last year, even as spreads have tightened significantly from earlier in 2016. So far this year, CMBS accounts for only 7% of the overall CRE lending market, down from 17% in 2015. At one point in 2006, CMBS accounted for nearly 50% of total CRE lending.

View entire article at Costar.com.

Find out more about our lending programs or contact Liberty to discuss an opportunity.

Day of Reckoning Comes for U.S. Shopping Malls Laden With Debt

June 20, 2016 by Randybaconin Commercial Mortgage Lending, Real EstateLeave a Comment

Suburban Detroit’s Lakeside Mall, with mid-range stores such as Sears, Bath & Body Works and Kay Jewelers, is one of the hundreds of retail centers across the U.S. being buffeted by the rise of e-commerce. After a $144 million loan on the property came due this month, owner General Growth Properties Inc. didn’t make the payment.

The default by the second-biggest U.S. mall owner may be a harbinger of trouble nationwide as a wave of debt from the last decade’s borrowing binge comes due for shopping centers. About $47.5 billion of loans backed by retail properties are set to mature over the next 18 months, data from Bank of America Merrill Lynch show. That’s coinciding with a tighter market for commercial-mortgage backed securities, where many such properties are financed.

Read the entire article in National Real Estate Investor

Banks Take a Step Back on Construction Loans

June 1, 2016 by Randybaconin Commercial Mortgage Lending, Real EstateLeave a Comment

Construction lending is on the rise as development pipelines continue to expand across commercial and multifamily markets. Yet borrowers are working harder to access that capital.

The volume of commercial and multifamily construction loans put in place in January reached $311.3 billion based on total project value. That represents a 14.3 percent increase year-over-year and a 40.7 percent increase compared to January 2014, according to the Mortgage Bankers Association’s Commercial/Multifamily Quarterly Databook for fourth quarter 2015.

View entire article in National Real Estate Investor.

Crowdfunding Fills Construction Lending Gap Left by Banks

May 31, 2016 by Randybaconin Commercial Mortgage Lending, Real EstateLeave a Comment

Crowdfunding websites are becoming an important piece of the real estate financing puzzle, especially for apartment developers who need a little extra debt or equity to complete their plans.

“Certainly from where they started, the growth of these crowdfunding portals seems exponential,” says Lee Weaver, senior vice president for Northmarq Capital, a commercial real estate debt and equity provider.

View entire article in National Real Estate Investor

To find out more about commercial mortgage financing options contact Liberty Realty Capital.

Is CMBS Seeing The Light?

May 24, 2016 by Randybaconin Commercial Mortgage Lending, Real EstateLeave a Comment

Thanks to three CMBS conduit deals totaling $2.3B, May has seen one of the most active CMBS issuance weeks in months, possibly signaling a reprieve from CMBS’s slow Q1. CMBS issuances hit $19.1B during Q1, down 30% from the $27B in Q1 ‘15. 2015 saw $101B of CMBS issuances, the first time CMBS broke $100B since 2007—but concerns in the CMBS industry, like greater risk-retention laws, are putting the brakes on hopes of hitting the same number in 2016. The Preserving Access to CRE Capital Act, which still has to get through the Senate, will do a lot to mitigate the new regulations, and “would also provide more flexibility in how CMBS transactions are structured, in order to better accommodate how investors raise capital and divide risk in the capital stack, reducing the rule’s unintended negative impact on CRE liquidity,” Real Estate Roundtable CEO Jeff DeBoer tells GlobeSt.

Read more at: https://www.bisnow.com/national/news/capital-markets/is-cmbs-seeing-the-light-60479?rt=17689?utm_source=CopyShare&utm_medium=Browser

To learn more about commercial mortgage financing contact Liberty Realty Capital Group

Regulatory Costs Account for Quarter of a New Home’s Price

May 12, 2016 by Randybaconin Commercial Mortgage Lending, Real EstateLeave a Comment

According to a new study released this week by the National Association of Home Builders (NAHB), on average, regulations imposed by all levels of government account for 24.3 percent of the sales price of a new single-family home in the U.S. in 2016.

Breaking down the total regulatory costs further, the study revealed that three-fifths of this–14.6 percent of the final house price–is due to a higher price for a finished lot resulting from regulations imposed during the lot’s development. The other two-fifths–9.7 percent of the house price–is the result of costs incurred by the builder after purchasing the finished lot.

“This study demonstrates the type of over-regulation our industry is facing,” said NAHB Chairman Ed Brady, a home builder and developer from Bloomington, Ill. “Not only is it inhibiting builders’ ability to produce competitively priced homes in a still recovering housing market, but this regulatory burden trickles down to the consumer level and prices many would-be buyers out of the market.”

While NAHB’s previous regulatory estimates in a 2011 study were fairly similar, the price of new homes increased substantially in the interim. When applying these percentages to Census data on new home prices, the data show an estimate that regulatory costs in an average home built for sale went from $65,224 to $84,671–a 29.8 percent increase during the roughly five-year span between NAHB’s 2011 and 2016 estimates. Meanwhile, disposable income per capita in the U.S. increased 14.4 percent during that same time period, meaning that the average cost of regulation embodied in a new home is rising more than twice as fast as the average American’s ability to pay for it. –

See entire article in World Property Journal