Headlines

“Equity REITs Decrease in November”

According to the FTSE NAREIT Equity Index, equity REITs showed a negative total return for November, 2011 with the index down 3.7 percent. In October, the index produced a positive rate of return of 14.25 percent.

Year-to-date, REITs are trading up 3.33 percent and are yielding 3.81 percent.

“Five Banks Failed in November” [is the bad news]

The good news is that November’s 5 failures is down from October’s 11 failures. Year-to-date, 90 banks have failed, an annualized pace of 100+/- for the calendar year.

Monday’s Numbers                                                     

The Trepp LLC survey showed spreads narrowing a few basis points across all property types in what was a lackluster week in the debt markets.

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

12/2/11

Office

342

214

210

Retail

326

207

206

Multifamily

318

188

200

Industrial

333

201

205

Average Asking Spread

330

203

205

10-Year Treasury

3.83%

3.29%

2.09%

The Cushman & Wakefield Sonnenblick-Goldman Survey for the period ending December 1, 2011 showed spreads for 10-year mortgages unchanged.

Property Type

Mid-Point of Fixed Rate Commercial Mortgage
Spreads For 5 Year Commercial Real Estate Mortgages

12/31/10

3/31/11

6/30/11

9/30/11

12/1/11

Multifamily – Non-Agency

+270

+245

+230

+250

+265

Multifamily – Agency

+280

+250

+210

+255

+255

Regional Mall

+280

+260

+265

+300

+310

Grocery Anchored

+280

+260

+250

+290

+295

Strip and Power Centers

 

 

+270

+310

+320

Multi-Tenant Industrial

+270

+265

+255

+295

+310

CBD Office

+280

+260

+255

+290

+310

Suburban Office

+300

+270

+270

+310

+325

Full-Service Hotel

+320

+300

+275

+335

+350

Limited-Service Hotel

+400

+325

+310

+345

+360

5-Year Treasury

2.60%

2.23%

1.52%

0.99%

0.98%

Source: Cushman & Wakefield Sonnenblick Goldman.

Property Type

Mid-Point of Fixed Rate Commercial Mortgage
Spreads For 10 Year Commercial Real Estate Mortgages

12/31/10

3/31/11

6/30/11

9/30/11

12/1/11

Multifamily – Non-Agency

+190

+180

+185

+240

+240

Multifamily – Agency

+200

+185

+175

+235

+235

Regional Mall

+175

+180

+190

+250

+250

Grocery Anchor

+190

+185

+200

+240

+245

Strip and Power Centers

 

 

+195

+255

+260

Multi-Tenant Industrial

+190

+190

+190

+250

+245

CBD Office

+180

+180

+190

+250

+250

Suburban Office

+190

+190

+195

+255

+265

Full-Service Hotel

+290

+230

+225

+300

+300

Limited-Service Hotel

+330

+260

+245

+325

+305

10-Year Treasury

3.47%

3.45%

2.94%

2.01%

2.13%

Source: Cushman & Wakefield Sonnenblick Goldman.

Property Type

Mid-Point of Floating-Rate Commercial Mortgage
Spreads For 3 – 5 Commercial Real Estate Year Mortgages

12/31/10

3/31/11

6/30/11

9/30/11

12/1/11

Multifamily – Non-Agency

+250-300

+225-325

+200-260

+225-250

+200-250

Multifamily- Agency

+300

+250-310

+220-260

+230-265

+220-265

Regional Mall

+275-300

+225-300

+205-270

+225-275

+215-275

Grocery Anchored

+275-300

+225-300

+205-275

+215-275

+210-275

Strip and Power Centers

 

 

+225-300

+225-300

+220-300

Multi-Tenant Industrial

+250-350

+250-350

+230-325

+250-325

+225-325

CBD Office

+225-300

+225-300

+215-300

+240-300

+225-300

Suburban Office

+250-350

+275-350

+250-325

+265-325

+245-325

Full-Service Hotel

+300-450

+350-450

+350-450

+350-450

+350-425

Limited-Service Hotel

+450-600

+400-500

+400-500

+400-500

+400-500

1-Month LIBOR

0.26%

0.22%

0.19%

0.24%

0.27%

3-Month LIBOR

0.30%

0.28%

0.25%

0.37%

0.53%

* A dash (-) indicates a range.

Source: Cushman & Wakefield Sonnenblick Goldman.


Year-to-Date Public Equity Capital Markets

DJIA (1): +5.24%
S & P 500 (2)-0.19%
NASDAQ (3): -023%
Russell 2000 (4):-4.88%
Morgan Stanley U.S. REIT (5):+1.14%
_____
 (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

12/11/11

3-Month

0.12%

0.00%

6-Month

0.18%

0.04%

2 Year

0.59%

0.22%

5 Year

2.01%

0.89%

10 Year

3.29%

2.06%