Category: Real Estate

Private Real Estate Lenders Move into Mainstream

by Randybaconin Commercial Mortgage Lending, Real EstateLeave a Comment on Private Real Estate Lenders Move into Mainstream

Private lenders that used to float on the fringes of the commercial real estate financing sector are stepping out of the shadows and becoming a more accepted financing alternative.

One of the primary drivers behind the shift is the abundance of capital. There is a lot of new money flowing into private lender shops from a variety of sources, including hedge funds, private equity and even sovereign wealth funds who are trying to capture higher yields.

“If you asked 10 people what private capital is, you would probably get 10 different answers,” says Shawn R. Hill, a principal at The BSC Group LLC, a mortgage banking firm based in Chicago. Theoretically, the term private lender could be loosely applied to any lender that is not a regulated bank, ranging from mortgage REIT to private equity groups. However, those groups are clearly seeing an influx of capital, he adds.

Case in point is Eagle Group Finance Loan Corp. The Los Angeles-based company has seen steady growth in its business since it expanded into private lending in 2008. In fact, Eagle Finance expects to double its lending in 2015 with $100 million in loans.

“Even now when banks have so much money and they say they’re lending more—they actually aren’t. They are only lending more to their preferred borrowers who have pristine credit and property on Main and Main,” says Brian Good, president of Eagle Finance Group.

Over the past several years, Eagle Finance has seen steady demand from borrowers, most notably on deals the banks won’t touch. The firm provides non-recourse short-term bridge loans of less than three years on commercial real estate and multifamily properties in western United States. In most cases, the property is in transition or the borrower is looking to clear-up credit issues, notes Good. Loans range from $2 million to $20 million and terms from six months to three years.

The search for higher yields is certainly drawing more capital into the private lending sector. At Eagle Finance, for example, rates range from 8 percent to 12 percent, double that of a traditional bank. “There is a lot of money coming into this sector,” says Good. Hedge funds, for example, are not hanging out a shingle, but rather they are pacing capital with firms that specialize in real estate lending and have the expertise.

View entire post at National Real Estate Investor.

To discuss commercial real estate financing needs contact Liberty Realty Capital.

Tech Park Moving From Concept to Physical Reality

by Randybaconin Real EstateLeave a Comment on Tech Park Moving From Concept to Physical Reality

The planned Little Rock Technology Park has existed mostly in theory since voters passed a half-cent sales tax back in 2011 to provide $22 million for its development.

Having recently cleared its last property acquisition hurdle for phase one of the $100 million project, the Little Rock Technology Park Authority board now has full architect renderings in hand. Phase one will entail 86,000 SF encompassing 415-421 Main St., and it’s expected to be complete by late 2016 or early 2017. Work is expected to begin early next year.

Wittenberg Delony & Davidson of Little Rock is the architect and is working with Gaudreau Inc. of Baltimore; East Harding of Little Rock is the contractor. The 38,000 SF that makes up 415 and 417 Main will anchor the project and house technology-focused companies, startups and entrepreneurs in a combination of co-working, semi-private and private offices.

The Arkansas Department of Higher Education occupies 48,000 SF at 421 Main and will continue to lease the space, providing the park with operating cash flow. The lease is $755,448.40 per year with an additional $3,995 per month for 85 parking spaces on Main.

Tech Park Director Brent Birch calls that a huge factor in the park’s launch. The total project, for which there is no definitive timetable, entails more than 600,000 SF spread over five phases.

For now, the Tech Park board is focused squarely on getting phase one off the ground, almost five years after Little Rock voters approved a tax increase to fund development through 2021. And it’s been eight years since enabling legislation was passed in the Arkansas General Assembly creating the board authority. The idea for a tech park was first floated by city leaders in 2005.

Read entire article in Arkansas Business

Find out more about Liberty at our Youtube page here.

To discuss commercial mortgage loans for your business or investment property contact Liberty Realty Capital.

 

 

CBD Office Buildings Experienced 10-Year Price Appreciation of More Than 100 Percent

by Randybaconin Real EstateLeave a Comment on CBD Office Buildings Experienced 10-Year Price Appreciation of More Than 100 Percent

The latest Commercial Property Prices Indices (CPPI) report produced by Moody’s and Real Capital Analytics (RCA) shows that prices in the commercial real estate universe have experienced double-digit appreciation over the past decade.

According to the report, the national all-property composite index has shown cumulative appreciation of 38.0 percent since October 2005, while the index for core commercial assets has gained by 34.9 percent. Significant price appreciation was evident in the index for apartment properties, as well, which increased by 45.9 percent since a decade ago.

The greatest level of price appreciation over the past 10 years, however, was posted by office buildings in Central Business Districts (CBDs), which posted a 103.2 percent increase over that time period. The index for retail properties, on the other hand, showed appreciation of only 8.6 percent during the past 10 years.

See entire article in National Real Estate investor.

Find out more about Liberty at our Youtube page.

To discuss commercial mortgage financing needs contact Liberty Realty Capital Group.

How Hotels Can Transform Downtowns

by Randybaconin Real EstateLeave a Comment on How Hotels Can Transform Downtowns
Oxford Capital Group CEO: How Hotels Can Transform Downtowns
Hotel developments and redevelopments can be foundations for turning depressed submarkets into hip, attractive destinations for travelers, local residents and other developers seeking building opportunities. Oxford Capital CEO John Rutledge has contributed to this trend in the nation’s hottest markets and talked to us about projects that’ll spur redevelopment.
John says Oxford loves being a catalyst for transitioning areas and tries to be in early on these developing neighborhoods, repurposing classic buildings for modern uses. He primarily focuses on the top 20 MSAs, with a heavy focus on urban submarkets, but will enter select tourist markets if a deal feels right. One key to being a transformative hotel: creating mixed-use that’s been lacking nearby. John always implements a mixed-use component, whether it’s retail offerings or added residential. John and his team are big believers in building “social hotels” with nice communal spaces, food and beverage components, and a heavy emphasis on rooftop bars. He also feels Oxford’s downtown projects work mainly due to their flexibility.
John sees a similar situation at the Lexington in Boston, where Oxford is working on its 240-key Godfrey Hotel (shown). He believes the Godfrey can be a linchpin in redeveloping Boston’s Downtown Crossing. He says Boston is one of the country’s most coveted, and most supply-constrained, markets. RevPAR growth there is higher than inflation. John tells us the $60M project is a classic Oxford deal: multidimensional and multifaceted, taking advantage of tax credits and emptying out an office for repositioning.
Read more at: https://www.bisnow.com/chicago/news/hotel/oxford-capital-groups-john-rutledge-talks-hotel-strategy-53412?utm_source=CopyShare&utm_medium=Browser

 

To discuss commercial mortgage financing needs contact Liberty Realty Capital Group.
[wpsocialboost_scroll]

Capital Spigot Is Wide Open

by Randybaconin Commercial Mortgage Lending, Real EstateLeave a Comment on Capital Spigot Is Wide Open

Borrowers are reveling in a market where capital is both cheap and plentiful, and even an expected rise in interest rates is not likely to take the wind out of the sails of the current robust lending climate.

“We’re enjoying the benefits of a great market,” says Ernie Katai, executive vice president and head of production at Berkadia, a commercial real estate company. Although 2014 was a record year for the firm in financing, year-over-year volume surged another 70 percent in 2015. Part of that jump can be attributed to a single $5.1 billion portfolio transaction. But excluding that deal the firm’s numbers would still be up 40 percent for the year, notes Katai.

Based on overall market liquidity, that momentum is expected to carry over into 2016. Lenders are keeping an eye on international headlines, notably the recent terrorist attacks and continued threats in Europe. However, lenders and financial intermediaries remain optimistic about the coming year. “Short of something outside of our control happening, the market for 2016 looks poised for another strong year,” Katai says.

Read entire article in National Real Estate Investor online here http://nreionline.com/finance-investment/capital-spigot-wide-openhttp://nreionline.com/finance-investment/capital-spigot-wide-open

To discuss commercial mortgage financing needs contact Liberty Realty Capital.

 

Shrinking U.S. Shopping Malls Get Makeovers

by Randybaconin Commercial Mortgage Lending, Real EstateLeave a Comment on Shrinking U.S. Shopping Malls Get Makeovers

Visitors used to flock to the Highland Mall in Austin, Texas, around the holidays to stroll through the city’s first enclosed shopping complex and admire the giant Christmas tree crafted from poinsettia plants.

But this holiday season, no shopping will be done there. Workers are converting the 600,000-square-foot structure into a campus for Austin Community College with classrooms, lab space and a culinary arts center.

Austin’s economy is strong and its population swelling, but Highland couldn’t attract enough shoppers to stay afloat.

“Competition came up and killed it,” said Matt Whelan, principal at developer Red Leaf Properties LLC, which is working with the college on the project.

An era of relentless expansion for American shopping centers is coming to an end as a toxic brew of overbuilding, the rise of e-commerce and a wave of retailer bankruptcies force landlords to reimagine once-lucrative properties.

Some owners are converting struggling malls into apartments, offices and industrial space, while others are turning big chunks of retail space into parks and playgrounds to keep shoppers interested.

“You have to create an environment that people want to come to,” said Tony Ruggeri, who eliminated about 50,000 square feet of retail space to create an open-air plaza at West Manchester Town Center in York, Pa., which reopened last year.

View entire article here in the Wall Street Journal.

Find out more about Liberty at our Youtube page.

To discuss commercial mortgage financing needs contact Liberty Realty Capital Group.