Spreads reported by Trepp LLC came in approximately 10 basis points during the survey period with financing available from an array of lenders including commercial banks, securitized lenders, and insurance companies.

According to the Commercial Mortgage Alert (March 16, 2012), conduit (securitized) lenders are “now quoting 10-year, fixed-rate loans at around 5%,” down from “closer to 6%” just a few months ago. So, conduit financing remains very attractive.

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

12/31/11

3/16/12

Month Earlier

Office

342

214

210

199

211

Retail

326

207

207

189

211

Multifamily

318

188

198

184

200

Industrial

333

201

205

189

205

Average Spread

330

203

205

190

207

10-Year Treasury

3.83%

3.29%

1.88%

1.95%

1.97%

The Cushman & Wakefield Sonnenblick-Goldman Survey shows rates coming in slightly with lenders seemingly ready to lend at attractive spreads if the right deal comes their way.

Property Type

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

12/31/10

1/5/12

1/26/12

2/28/12

Multifamily – Non-Agency

+270

+245

+240

+240

Multifamily – Agency

+280

+255

+245

+210

Regional Mall

+280

+300

+300

+300

Grocery Anchored

+280

+295

+295

+290

Strip and Power Centers

 

+320

+320

+315

Multi-Tenant Industrial

+270

+305

+310

+310

CBD Office

+280

+310

+310

+295

Suburban Office

+300

+320

+320

+310

Full-Service Hotel

+320

+350

+350

+350

Limited-Service Hotel

+400

+360

+360

+360

5-Year Treasury

2.60%

0.89%

0.78%

0.83%

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

1/5/12

1/26/12

2/28/12

Multifamily – Non-Agency

+190

+205

+210

+210

Multifamily – Agency

+200

+200

+205

+180

Regional Mall

+175

+245

+245

+235

Grocery Anchor

+190

+240

+240

+230

Strip and Power Centers

 

+255

+255

+250

Multi-Tenant Industrial

+190

+245

+255

+250

CBD Office

+180

+250

+240

+320

Suburban Office

+190

+265

+260

+250

Full-Service Hotel

+290

+300

+290

+290

Limited-Service Hotel

+330

+310

+315

+315

10-Year Treasury

3.47%

2.00%

1.97%

1.90%

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

1/5/12

1/26/12

2/28/12

Multifamily – Non-Agency

+250-300

+200-250

+200-250

+200-250

Multifamily- Agency

+300

+220-265

+220-265

+220-265

Regional Mall

+275-300

+250-350

+210-265

+200-265

Grocery Anchored

+275-300

+240-325

+200-275

+200-275

Strip and Power Centers

 

+250-350

+225-300

+225-300

Multi-Tenant Industrial

+250-350

+270-350

+225-305

+225-305

CBD Office

+225-300

+275-350

+225-300

+225-300

Suburban Office

+250-350

+300-350

+250-325

+250-325

Full-Service Hotel

+300-450

+375-475

+350-425

+275-400

Limited-Service Hotel

+450-600

+375-550

+400-500

+350-550

1-Month LIBOR

0.26%

0.30%

0.27%

0.24%

3-Month LIBOR

0.30%

0.58%

0.55%

0.49%

* A dash (-) indicates a range.

Source: Cushman & Wakefield Sonnenblick Goldman.

Year-to-Date Public Equity Capital Markets

DJIA (1): +7.06%
S & P 500 (2): +11.09%
NASDAQ (3): +17.76%
Russell 2000 (4):+11.99%
Morgan Stanley U.S. REIT (5):+7.99%

 (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

12/31/11

3/24/12

3-Month

0.12%

0.01%

.07%

6-Month

0.18%

0.06%

.14%

2 Year

0.59%

0.24%

.35%

5 Year

2.01%

0.83%

1.08

10 Year

3.29%

1.88%

2.23%

                                       

Key Rates (in Percentages)

 

Current

1 Mo. Prior

3 Mo. Prior

6 Mo. Prior

1 Yr. Prior

Fed Funds Rate

0.15

0.10

0.07

0.10

0.15

Federal Reserve Target Rate

0.25

0.25

0.25

0.25

0.25

Prime Rate

3.25

3.25

3.25

3.25

3.25

US Unemployment Rate

8.30

8.30

8.70

9.10

9.00

1-Month Libor

0.24

0.24

0.29

0.24

0.25

3-Month Libor

0.47

0.49

0.58

0.36

0.31