Tag Archives: Commercial Real Estate

"There's tremendous difficulty in the commercial real estate market with higher interest rates," said Lawrence Yun, the Chief Economist for the National Association of Realtors. But are there changes on the horizon?

“Borrowing and lending were down for every property type and capital source from one year ago. However, compared to this year’s second quarter, volumes were more stable, and some sectors—including industrial properties and life company lenders – showed an uptick in volume,” said Jamie Woodwell, MBA’s Head of Commercial Real Estate Research.

Amherst Capital Management LLC announced the addition of Damon Pitler to its private funds leadership team. Serving in the role of Managing Director of Private Funds, Pitler will manage single-family equity and commercial real estate lending portfolios at Amherst.

The Mortgage Bankers Association (MBA) released over the weekend its year-end ranking of commercial and multifamily servicers' volumes--and once again, Wells Fargo topped the list. According to MBA's numbers, Wells Fargo took the No. 1 spot with $434.4 billion in dollar volume and 33,354 in loan volume. Following it were PNC Real Estate ($369.6 billion, up from $337.6 billion the previous year) and Berkadia Commercial Mortgage ($235.4 billion, up from $197.3 billion).

WDB Funding, LLC, announced the appointment of Andrew Pollock as the firm's president and CEO. Pollock brings 25 years' experience heading large-scale lending operations to his new role, where he is responsible for providing day-to-day leadership, managing operations, and executing the strategic direction of the company.

Commercial real estate (CRE) loan prices in the secondary market were largely flat in November, according to the latest report from DebtX, a loan sale advisor for commercial, consumer, and specialty finance debt. The estimated price of whole loans increased to 92.7 percent as of November 30, rising from 92.3 percent the prior month. Loan values were 89.4 percent. Meanwhile, DebtX's Loan Liquidity Index was 107.5, up from 105.7 in October.

In the years leading up to the economic downturn, lenders became more aggressive and eased requirements in order to increase volume and satisfy investor demand for securitized commercial real estate products. Loans originated in 2004 and 2005 generally had a lower loan-to-value (LTV) ratio than those originated in 2006 and 2007. Since the majority of these loans have ten year terms, the 2004 through 2007 loans will come due in the next three years.

Research experts at Jones Lang LaSalle (JLL) expect a "clear path to stronger performance" for commercial real estate (CRE) in 2014. Reviewing what they call "surprising upsides" in investment sales volume over the last year, JLL's top researchers say they expect the factors driving 2013's growth--an improving lender environment, heightened risk appetite, and the arrival of investors in secondary markets--are expected to continue to move the sector forward. As far as U.S.-specific growth is concerned: "It all comes down to jobs."

The level of commercial/multifamily mortgage debt outstanding increased $25.2 billion in Q3, with all four major investor groups increasing their holdings, the Mortgage Bankers Association (MBA) reported. The quarterly increase (representing about a 1.0 percent gain) was the largest since 2008, MBA reported. As of the end of the third quarter, total commercial and multifamily debt outstanding was $2.47 trillion. Just on the multifamily side, outstanding debt increased $10.8 billion (1.2 percent) to $887 billion.

Commercial real estate (CRE) patterns are expected to continue on a steady but modest growth path, the National Association of Realtors (NAR) predicted Friday in its quarterly CRE forecast. "Jobs are the key driver for commercial real estate, and the accumulation of 7 million net new jobs from the row point a few years ago is steadily showing up as demand for leasing and purchases of properties," said NAR chief economist Lawrence Yun. However, Yun said, "the difficulty of accessing loans remains a hindrance to a faster recovery."