Headlines

“FDIC’s List of ‘Problem’ Banks Drops for First Time Since 2006”

The Federal Deposit Insurance Corporation’s supposedly confidential list of banks considered at risk of failing included 865 banks as of June 30, 2011, a decrease of 23 since the prior quarter. ”Banks have continued to make gradual but steady progress in recovering from the financial market turmoil and severe recession that unfolded from 2007 through 2009,” said Martin Gruenberg, acting chairman of the FDIC.

Monday’s Numbers

Due to earthquakes, hurricanes, and vacation schedules, the Trepp LLC survey will not be updated until after Labor Day. An informal survey we conducted this week showed most borrowers and lenders waiting for things to “just settle down.” We understand some insurance companies are considering instituting “Floor Pricing” but we’ve seen no official policy statements so far.

Asking Spreads over U.S. Treasury Bonds in Basis Points
(10-year Commercial and Multifamily Mortgage Loans with 50% to 59% Loan-to-Value Ratios)

12/31/09

12/31/10

8/12/11

Office

342

214

217

Retail

326

207

209

Multifamily

318

188

197

Industrial

333

201

206

Average Asking Spread

330

203

207

10-Year Treasury

3.83%

3.29%

2.25%

The Cushman & Wakefield Sonnenblick-Goldman Survey for the period ended August 24th showed 5-year fixed rate spreads relatively unchanged with 10-year fixed rates spreads widening as much as 15 basis points; floating rate spreads were basically unchanged.

Property Type

Mid-Point of Fixed Rate Commercial Mortgage

Spreads For 5 Year Commercial Real Estate Mortgages

12/16/10

3/31/11

7/28/11

8/11/11

8/24/11

Multifamily – Non-Agency

+270

+245

+250

+255

+265

Multifamily – Agency

+280

+250

+240

+265

+250

Regional Mall

+280

+260

+280

+290

+290

Grocery Anchored

+280

+260

+270

+285

+285

Strip and Power Centers

 

 

+290

+300

+300

Multi-Tenant Industrial

+270

+265

+275

+295

+285

CBD Office

+280

+260

+275

+290

+290

Suburban Office

+300

+270

+295

+300

+300

Full-Service Hotel

+320

+300

+230

+320

+320

Limited-Service Hotel

+400

+325

+320

+340

+340

5-Year Treasury

2.60%

2.23%

1.49%

0.97%

0.96%

Source: Cushman & Wakefield Sonnenblick Goldman.

Property Type

Mid-Point of Fixed Rate Commercial Mortgage

Spreads For 10 Year Commercial Real Estate Mortgages

12/1610

3/31/11

7/28/11

8/11/11

8/24/11

Multifamily – Non-Agency

+190

+180

+195

+240

+240

Multifamily – Agency

+200

+185

+190

+245

+230

Regional Mall

+175

+180

+205

+240

+255

Grocery Anchor

+190

+185

+195

+230

+250

Strip and Power Centers

 

 

+210

+250

+260

Multi-Tenant Industrial

+190

+190

+230

+240

+250

CBD Office

+180

+180

+225

+240

+255

Suburban Office

+190

+190

+235

+260

+260

Full-Service Hotel

+290

+230

+250

+275

+275

Limited-Service Hotel

+330

+260

+270

+295

+280

10-Year Treasury

3.47%

3.45%

2.97%

2.23%

2.16%

Source: Cushman & Wakefield Sonnenblick Goldman.

Property Type

Mid-Point of Floating-Rate Commercial Mortgage

Spreads For 3 – 5 Commercial Real Estate Year Mortgages

12/16/10

3/31/11

8/11/11

7/28/11

824/11

Multifamily – Non-Agency

+250-300

+225-325

+220-260

+200-250

+220-260

Multifamily- Agency

+300

+250-310

+230-270

+220-260

+230-270

Regional Mall

+275-300

+225-300

+220-270

+205-270

+220-270

Grocery Anchored

+275-300

+225-300

+210-275

+205-275

+210-275

Strip and Power Centers

 

 

+235-300

+225-300

+235-300

Multi-Tenant Industrial

+250-350

+250-350

+250-325

+230-325

+250-325

CBD Office

+225-300

+225-300

+235-300

+225-300

+235-300

Suburban Office

+250-350

+275-350

+265-325

+250-325

+265-325

Full-Service Hotel

+300-450

+350-450

+350-450

+350-450

+350-450

Limited-Service Hotel

+450-600

+400-500

+400-500

+400-500

+400-500

1-Month LIBOR

0.26%

0.22%

0.21%

0.19%

0.22%

3-Month LIBOR

0.30%

0.28%

0.29%

0.25%

0.31%

* A dash (-) indicates a range.

Source: Cushman & Wakefield Sonnenblick Goldman.

Year-to-Date Public Equity Capital Markets

DJIA (1): -2.53%
S & P 500 (2):-6.43%
NASDAQ (3): -6.52%
Russell 2000 (4):-11.75%
MSCI U.S. REIT (5):-1.16%

 (1) Dow Jones Industrial Average. (2) Standard & Poor’s 500 Stock Index. (3) NASD Composite Index.
(4) Small Capitalization segment of U.S. equity universe. (5) Morgan Stanley REIT Index.

U.S. Treasury Yields

12/31/10

8/26/2011

3-Month

0.12%

-0.01%

6-Month

0.18%

0.02%

2 Year

0.59%

0.19%

5 Year

2.01%

0.94%

10 Year

3.29%

2.19%