Headlines

“CMBS Delinquencies Rise Again” [Scary October]

According to Trepp, the 30-day delinquency rate for commercial mortgage-backed securities increased by 21 basis points in October to 9.77%, its second highest level…ever! Need we say more?

Monday’s Numbers

The Trepp LLC survey showed spreads widening 15+/- basis points during the most recent survey period, evidence that the debt market remains cautious and easily spooked by current events. Nevertheless, all-numbers are more than a little 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

11/4/11

Office

342

214

212

Retail

326

207

206

Multifamily

318

188

196

Industrial

333

201

202

Average Asking Spread

330

203

204

10-Year Treasury

3.83%

3.29%

2.03%

The Cushman & Wakefield Sonnenblick-Goldman Survey for the period ending November 3rd  showed spreads for 10-year mortgages basically unchanged, i.e., up five basis points here, down five basis points there.

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

11/3/11

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

+300

Strip and Power Centers

 

 

+270

+310

+320

Multi-Tenant Industrial

+270

+265

+255

+295

+315

CBD Office

+280

+260

+255

+290

+315

Suburban Office

+300

+270

+270

+310

+330

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%

0.93%

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

11/3/11

Multifamily – Non-Agency

+190

+180

+185

+240

+240

Multifamily – Agency

+200

+185

+175

+235

+235

Regional Mall

+175

+180

+190

+250

+255

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

+255

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%

2.05%

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

11/3/11

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

+210-275

Grocery Anchored

+275-300

+225-300

+205-275

+215-275

+205-275

Strip and Power Centers

 

 

+225-300

+225-300

+220-300

Multi-Tenant Industrial

+250-350

+250-350

+230-325

+250-325

+250-325

CBD Office

+225-300

+225-300

+215-300

+240-300

+230-300

Suburban Office

+250-350

+275-350

+250-325

+265-325

+250-325

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%

0.25%

3-Month LIBOR

0.30%

0.28%

0.25%

0.37%

0.44%

* A dash (-) indicates a range.

Source: Cushman & Wakefield Sonnenblick Goldman.

Year-to-Date Public Equity Capital Markets

DJIA (1): +4.98%
S & P 500 (2)+0.49%
NASDAQ (3): +0.98%
Russell 2000 (4):-4.96%
MSCI U.S. REIT (5):+3.09%

 (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

11/12/11

3-Month

0.12%

0.00%

6-Month

0.18%

0.02%

2 Year

0.59%

0.23%

5 Year

2.01%

0.91%

10 Year

3.29%

2.06%