Today’s post is written by Michael Green, Senior Commercial Loan Originator with Counsel Mortgage Group, LLC. Mike writes monthly on the commercial mortgage market. Check back each month for his commentary. The 10-year Treasury yield is more important to CRE than whatever the level of the federal funds rate may be. That’s why the recent direction of this benchmark’s yield is making many investors nervous. The Fed dropped fed funds rates in both November and December, and the 10-year Treasury did a zoom maneuver! What’s with that? Reflation risks are becoming more evident, with recent data pointing to “sticky” inflationary...
Commercial Loans
2024 CRE MORTGAGE LENDING ACTIVITY THROUGH Q3-24
Today’s post is written by Michael Green, Senior Commercial Loan Originator with Counsel Mortgage Group, LLC. Mike writes monthly on the commercial mortgage market. Check back each month for his commentary. Despite uncertainty in: Ø the economy, Ø the health and well-being of the CRE market, Ø Fed policy and interest rate movements, Ø the burdensome level of existing debt for all groups of borrowers, Ø international turmoil and wars, Ø domestic discord and outright violence, Ø and the prospects of a new federal government, the level of commercial/multifamily mortgage debt outstanding continued to increase in Q3-24. The total level...
January 11, 2025January 11, 2025john
POST-ELECTION CRE
Today’s post is written by Michael Green, Senior Commercial Loan Originator with Counsel Mortgage Group, LLC. Mike writes monthly on the commercial mortgage market. Check back each month for his commentary. Only 4 weeks out from the presidential election the CRE market is already anticipating changes that may come with the new administration. The Republican sweep of the Executive branch and both houses of Congress is expected to substantially impact both the number of policy changes and the size of those changes. Plodding through the numerous cabinet nominations and ambassadorships, and the theatre created by the counter-party responses to these,...
December 2, 2024December 2, 2024john
THE SLOWLY IMPROVING TREND – STNL
Today’s post is written by Michael Green, Senior Commercial Loan Originator with Counsel Mortgage Group, LLC. Mike writes monthly on the commercial mortgage market. Check back each month for his commentary. In Q3-24, for the 10th consecutive quarter, cap rates for single-tenant net lease (STNL) properties increased quarter-over-quarter in retail, office, and industrial. The blended cap rate increase was 3 bps (basis points) (6.70% to 6.73%). It shows that the biggest contributor to average cap rates came from retail. The primary reason for the long-standing increase in cap rates was relatively high interest rates in the market. Additionally, a...
November 4, 2024November 4, 2024john
WHY HIRE A MORTGAGE BROKER FOR A CRE LOAN?
Today’s post is written by Michael Green, Senior Commercial Loan Originator with Counsel Mortgage Group, LLC. Mike writes monthly on the commercial mortgage market. Check back each month for his commentary. This may be a fairly timely question, given that the Fed has just begun its new interest rate downward cycle. With the perceived pent-up demand for lenders to ramp up loans, it may seem like it’s a borrower’s market. We suggest that’s not the case. Lenders perceive that pent-up demand on the borrower’s side also. It’s likely to be some of both. If that’s the case, which party...
October 2, 2024October 2, 2024john
LIKE A KID AT CHRISTMAS
Today’s post is written by Michael Green, Senior Commercial Loan Originator with Counsel Mortgage Group, LLC. Mike writes monthly on the commercial mortgage market. Check back each month for his commentary. That’s the pulse of the market folks. Borrowers and lenders all huddled around their computers waiting for Santa Powell and the FOMC elves to deliver their Sept. rate cut on Sept. 18. Lenders have created their list of qualified borrowers and properties, and borrowers have corralled their favorite lenders. Just a few more weeks … patience, patience! Maybe too much drama, but you get the point, and from...
August 31, 2024August 31, 2024john
ONE FOMC MEETING AWAY
Today’s post is written by Michael Green, Senior Commercial Loan Originator with Counsel Mortgage Group, LLC. Mike writes monthly on the commercial mortgage market. Check back each month for his commentary. Markets are poised today awaiting the FED announcement tomorrow of interest rate policy for the next 6 weeks. A heavy abundance of FED watchers collectively anticipates no change in the Fed Funds rate. The post-meeting press conference is expected to phrase in no uncertain terms that the next rate decrease will occur at the September meeting in 6 weeks. (We note that black swans regularly upset the smart-money majority...
July 30, 2024July 30, 2024john
WHAT’S NEW IN THE WORLD OF CRE LENDING?
Today’s post is written by Michael Green, Senior Commercial Loan Originator with Counsel Mortgage Group, LLC. Mike writes monthly on the commercial mortgage market. Check back each month for his commentary. For the answer, consider what’s in the recent headlines of industry tabloids, websites, BLOGs, social media platforms, etc. Fed Holds Fed Funds Rate at 5 ¼-5 ½ %, Fed Raises Specter of Rate Hike Again, Distress Jumps While Extend-and-Pretend Continues, Interest Rate CAP Costs Surging Again, FDIC Lists 56 Banks on Insolvency Watch List Top Rated CRE Bond Fund Hit with Losses. There are more of the same, that...
June 28, 2024June 28, 2024john
THE CRE MARKET WILL HEAT UP IN H2-24 . . . GET READY
Today’s post is written by Michael Green, Senior Commercial Loan Originator with Counsel Mortgage Group, LLC. Mike writes monthly on the commercial mortgage market. Check back each month for his commentary. As CRE data reflecting the post-COVID damage emerged last summer (or so), we began to notify you that investors were penciling out shark-in-the-water deals. Last fall and through the winter we highlighted hesitancy/reluctance/inability of traditional lenders (banks) to make “reasonable” CRE loans, either for refi or acquisitions. This activity and posturing was mostly happening quietly behind the scenes, and often by smaller players. The cycle is reminiscent of 2001-2002,...
June 1, 2024June 1, 2024john
RETAIL SEGMENT OF CRE CONTINUES TO IMPROVE
Today’s post is written by Michael Green, Senior Commercial Loan Originator with Counsel Mortgage Group, LLC. Mike writes monthly on the commercial mortgage market. Check back each month to check his commentary. Trepp (CRE research & analytics) released their CMBS Delinquency rate for March, showing it dipped slightly for the month, led by a significant improvement in the retail CMBS delinquency rate (and, notably, a 5 bp (basis point) uptick in the office delinquency rate). The overall delinquency rate declined 4 bps to 4.67%, with retail delinquency posting a huge 47 bp drop to 5.56%. Per Thomas Taylor at Trepp:...
May 2, 2024May 2, 2024john