The equity and debt capital markets re-opened Wednesday as analysts started to assess the economic impact of Sandy while waiting for the jobs report which wasn’t released until Friday morning. The jobs numbers were better than the majority of analysts projected with upward adjustments to prior monthly totals an unexpected (and welcome) surprise.

Treasury yields ended the shortened week about where they started, with prices up a tick and yields down a tick, as investors sought shelter in the liquid and safe U.S. Treasury markets.

Many investors and lenders appear to have decided to sit on the sidelines until after the Presidential elections on Tuesday, preferring to wait it out for a few days until they can assess what the outlook may be under the different administrations.

The race to get to the finish line, i.e., to get deals closed by yearend, starts next Wednesday. 

Monday’s Numbers

Due to service interruptions caused by Sandy, the publisher of the Trepp survey was unable to distribute its findings this week.

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

10/19

Week Earlier

Month Earlier

Office

342

214

210

221

225

223

Retail

326

207

207

205

215

215

Multifamily

318

188

202

198

210

201

Industrial

333

201

205

206

216

215

Average Spread

330

203

205

208

214

214

10-Year Treasury

3.83%

3.29%

1.88%

1.75%

1.69%

1.64%


The Cushman & Wakefield Equity, Debt, and Structured Finance Commercial Mortgage Spread monthly survey of commercial mortgage spreads showed spreads for 10-year, fixed rate mortgages, coming in a uniform 5 basis points across all property sectors and terms over the past 30 days.

Property Type

Mid-Point of Fixed Rate Commercial Mortgage

Spreads For 5 Year Commercial Real Estate Mortgages

12/31/10

6/28/12

7/26/12

9/3/12

9/27/12

Multifamily – Non-Agency

+270

+245

+245

+240

+235

Multifamily – Agency

+280

+225

+225

+225

+210

Regional Mall

+280

+300

+295

+290

+285

Grocery Anchored

+280

+295

+290

+285

+280

Strip and Power Centers

 

+320

+315

+310

+305

Multi-Tenant Industrial

+270

+305

+300

+295

+290

CBD Office

+280

+300

+295

+285

+280

Suburban Office

+300

+315

+315

+305

+300

Full-Service Hotel

+320

+360

+360

+360

+355

Limited-Service Hotel

+400

+370

+370

+370

+365

5-Year Treasury

2.60%

0.69%

0.57%

0.68%

0.64%

Source: Cushman & Wakefield Equity, Debt, and Structured Finance.

Property Type

Mid-Point of Fixed Rate Commercial Mortgage

Spreads For 10 Year Commercial Real Estate Mortgages

12/31/10

6/28/12

7/26/12

9/3/12

9/27/12

Multifamily – Non-Agency

+190

+220

+220

+210

+205

Multifamily – Agency

+200

+200

+210

+210

+195

Regional Mall

+175

+245

+235

+230

+225

Grocery Anchor

+190

+235

+230

+225

+220

Strip and Power Centers

 

+255

+250

+245

+240

Multi-Tenant Industrial

+190

+260

+255

+250

+245

CBD Office

+180

+250

+245

+235

+230

Suburban Office

+190

+265

+265

+260

+255

Full-Service Hotel

+290

+290

+290

+290

+285

Limited-Service Hotel

+330

+310

+310

+310

+305

10-Year Treasury

3.47%

1.58%

1.42%

1.64%

1.64%

Source: Cushman & Wakefield Equity, Debt, and Structured Finance.

Property Type

Mid-Point of Floating-Rate Commercial Mortgage

Spreads For 3 – 5 Commercial Real Estate Year Mortgages

12/31/10

6/28/12

7/26/12

9/3/12

9/27/12

Multifamily – Non-Agency

+250-300

+200-260

+200-260

+200-260

+200-260

Multifamily- Agency

+300

+220-265

+220-265

+220-265

+220-265

Regional Mall

+275-300

+210-275

+210-275

+210-275

+210-275

Grocery Anchored

+275-300

+210-275

+210-275

+210-275

+210-275

Strip and Power Centers

 

+225-300

+225-300

+225-300

+225-300

Multi-Tenant Industrial

+250-350

+235-305

+230-305

+230-305

+230-305

CBD Office

+225-300

+225-300

+225-300

+225-300

+225-300

Suburban Office

+250-350

+250-325

+250-325

+250-325

+250-325

Full-Service Hotel

+300-450

+275-400

+275-400

+275-400

+275-400

Limited-Service Hotel

+450-600

+325-450

+325-450

+325-450

+325-450

1-Month LIBOR

0.26%

0.24%

0.24%

0.24%

0.24%

3-Month LIBOR

0.30%

0.47%

0.46%

0.43%

0.43%

* A dash (-) indicates a range.

Source: Cushman & Wakefield Equity, Debt, and Structured Finance.


Year-to-Date Public Equity Capital Markets

DJIA (1): +7.17%

S & P 500 (2): +12.45%

NASDAQ (3): +14.47%

Russell 2000 (4):+9.92%

Morgan Stanley U.S. REIT (5):+11.91%

 (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

11/3/12

3-Month

0.12%

0.01%

0.09%

6-Month

0.18%

0.06%

0.15%

2 Year

0.59%

0.24%

0.28%

5 Year

2.01%

0.83%

0.72%

7 Year

 

 

1.15%

10 Year

3.29%

1.88%

1.71%

                                                  

Key Rates (in Percentages)

 

Current

1 Mo. Prior

3 Mo. Prior

6 Mo. Prior

1 Yr. Prior

Fed Funds Rate

0.17

0.17

0.06

0.15

0.08

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

7.90

7.80

8.30

8.10

8.90

1-Month Libor

0.21

0.21

0.24

0.24

0.25

3-Month Libor

0.31

0.25

0.44

0.47

0.43