Monday’s Numbers: April 4, 2011

The Commercial Mortgage Alert Trepp weekly survey of 15 active portfolio lenders remained unchanged with financing available at attractive rates (5.25%+/-). The Commercial Mortgage Alert Trepp weekly survey of 15 active portfolio lenders remained unchanged with financing available at attractive rates (5.25%+/-).

April 4, 2011

Facebook
Twitter
LinkedIn
Print
Copy
Link copied
Email

Headlines

Headlines and quotes we publish are intended to convey a sense of the terms and conditions present in the real estate capital markets.

Quote of the Week: “Each of the deals that have gone out have been over-subscribed. There is a lot of originator money chasing borrowers and investor money chasing product,” said Daniel Rubock, Senior Vice President, Moody’s Investors Service, while speaking about competition in the commercial mortgage-backed securities market, as quoted in Real Estate Finance & Investment.

Comment: This is how bubbles are formed.

Monday’s Numbers

The Commercial Mortgage Alert Trepp weekly survey (below) of 15 active portfolio lenders remained unchanged with financing available at attractive rates (5.25%+/-).

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	3/5/2011	3/11/2011	3/18/2011	3/25/2011
Office	342	214	183	182	188	190
Retail	326	207	175	171	174	174
Multifamily	318	188	159	156	158	159
Industrial	333	201	171	168	174	172
Average Asking Spread	330	203	172	169	174	174
10-Year Treasury	3.83%	3.29%	3.49%	3.40%	3.27%	3.44%
Source: Commercial Mortgage Alert; Trepp.

The Cushman & Wakefield Sonnenblick-Goldman Survey ended March literally where it started with spreads in the 250 basis point (for 5-year loans) and 185 basis point (for 10-year loans).

Property Type	Mid-Point of Fixed Rate Commercial Mortgage Spreads For 5 Year Commercial Real Estate Mortgages
	12/16/10	2/3/11	2/15/11	3/2/11	3/31/11
Multifamily - Non-Agency	+270	+250	+250	+245	+245
Multifamily – Agency	+280	+255	+255	+250	+250
Regional Mall	+280	+260	+260	+260	+260
Grocery Anchored	+280	+265	+260	+260	+260
Multi-Tenant Industrial	+270	+270	+270	+265	+265
CBD Office	+280	+260	+260	+260	+260
Suburban Office	+300	+270	+270	+270	+270
Full-Service Hotel	+320	+300	+300	+300	+300
Limited-Service Hotel	+400	+330	+330	+325	+325
5-Year Treasury	2.60%	2.06%	2.36%	2.17%	2.23%
Source: Cushman & Wakefield Sonnenblick Goldman.

Property Type	Mid-Point of Fixed Rate Commercial Mortgage Spreads For 10 Year Commercial Real Estate Mortgages
	12/1610	2/3/11	2/15/11	3/2/11	3/31/11
Multifamily - Non-Agency	+190	+190	+180	+180	+180
Multifamily – Agency	+200	+200	+190	+185	+185
Regional Mall	+175	+180	+180	+180	+180
Grocery Anchor	+190	+185	+185	+185	+185
Multi-Tenant Industrial	+190	+190	+190	+190	+190
CBD Office	+180	+180	+180	+180	+180
Suburban Office	+190	+190	+190	+190	+190
Full-Service Hotel	+290	+250	+240	+230	+230
Limited-Service Hotel	+330	+260	+260	+260	+260
10-Year Treasury	3.47%	3.46%	3.63%	3.47%	3.45%
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	2/3/11	2/15/11	3/2/11	3/31/11
Multifamily – Non-Agency	+250-300	+225-300	+225-300	+225-300	+225-300
Multifamily- Agency	+300	+250-300	+250-300	+250-300	+250-300
Regional Mall	+275-300	+250-275	+250-275	+225-275	+225-300
Grocery Anchored	+275-300	+250-300	+250-300	+225-275	+225-300
Multi-Tenant Industrial	+250-350	+250-350	+250-300	+250-350	+250-350
CBD Office	+225-300	+250-300	+250-300	+225-300	+225-300
Suburban Office	+250-350	+275-350	+275-350	+275-350	+275-350
Full-Service Hotel	+300-450	+350-400	+350-450	+350-450	+350-450
Limited-Service Hotel	+450-600	+400-500	+400-500	+400-500	+400-500
1-Month LIBOR	0.26%	0.26%	0.26%	0.26%	0.24%
3-Month LIBOR	0.30%	0.31%	0.31%	0.31%	0.30%
* A dash (-) indicates a range.
Source: Cushman & Wakefield Sonnenblick Goldman.

Year-to-Date Public Equity Capital Markets

DJIA ⁽¹⁾: +6.91%
S & P 500⁽²⁾:+5.85%
NASDAQ⁽³⁾: +5.07%
Russell 2000 ⁽⁴⁾:+7.23%
MSCI U.S. REIT ⁽⁵⁾:+5.16%
_____
^{(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	3/19/2011	3/23/2011	4/2/2011
3-Month	0.12%	0.06%	0.08%	0.06%
6-Month	0.18%	0.13%	0.16%	0.14%
2 Year	0.59%	0.58%	0.73%	0.80%
5 Year	2.01%	1.94%	2.16%	2.24%
10 Year	3.29%	3.27%	3.44%	3.44%
Source: Bloomberg LLP.

Facebook
Twitter
LinkedIn
Print
Copy
Link copied
Email

Public

Stephen Blank

Stephen R. Blank joined ULI in December 1998 as Senior Fellow, Finance. His primary responsibilities include: expanding ULI’s real estate capital markets information and education programs; authoring real estate capital market commentary; participating as a principal researcher and adviser for the Emerging Trends in Real Estate series of publications; organizing and participating in real estate capital markets programs at ULI events worldwide; and participating in industry meetings, seminars, and conferences. Prior to joining ULI, Blank served from December 1993 to November 1998 as Managing Director, Real Estate Investment Banking of Oppenheimer & Co., Inc. His responsibilities included: structuring, underwriting, and executing corporate financings including initial public offerings of common and preferred shares, unsecured debentures, and convertible bonds; property acquisitions, dispositions, and financing; and financial advisory services including mergers and acquisitions, corporate restructurings, and recapitalizations.