Headlines
The following appeared in a recent e-edition of Standard & Poor’s daily asset backed securities research.
“CMBS: Modest New Issuance Growth; 2007 Maturities Struggling”
“The current CMBS pipeline indicates modest year-over-year new issuance growth, while the latest payoff data suggests that 2007 vintage loans are struggling to refinance. Adding the year-to-date new issuance figure of $1.3billion to the current Commercial Mortgage Alert pipeline of 14 deals totaling $10.8 billion through April indicates an annualized pace of $36-$37billion in 2012, which represents about 10-15% year-over-year growth, and slightly above our [Standard & Poor’s] forecast of $35billion. Meanwhile, only 27% of 2007 vintage loans that came due in January paid off, and nearly half of the total was attributed to one large loan, according to Trepp.
Monday’s Numbers
During the survey period, the Trepp LLC survey indicated spreads widening five to 10 basis points.
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 | 1/27/12 | Month Earlier | |
Office | 342 | 214 | 210 | 222 | 210 |
Retail | 326 | 207 | 207 | 215 | 207 |
Multifamily | 318 | 188 | 198 | 209 | 198 |
Industrial | 333 | 201 | 205 | 212 | 205 |
Average Spread | 330 | 203 | 205 | 215 | 205 |
10-Year Treasury | 3.83% | 3.29% | 1.88% | 1.89% | 1.92% |
The Cushman & Wakefield Sonnenblick-Goldman Survey shows rates unchanged to down five basis points. Lenders seem to be going about their business, reacting to market events as necessary.
Property Type | Mid-Point of Fixed Rate Commercial Mortgage | ||||
12/31/10 | 1/5/12 | 1/26/12 | |||
Multifamily - Non-Agency | +270 | +245 | +240 | ||
Multifamily – Agency | +280 | +255 | +245 | ||
Regional Mall | +280 | +300 | +300 | ||
Grocery Anchored | +280 | +295 | +295 | ||
Strip and Power Centers |
| +320 | +320 | ||
Multi-Tenant Industrial | +270 | +305 | +310 | ||
CBD Office | +280 | +310 | +310 | ||
Suburban Office | +300 | +320 | +320 | ||
Full-Service Hotel | +320 | +350 | +350 | ||
Limited-Service Hotel | +400 | +360 | +360 | ||
5-Year Treasury | 2.60% | 0.89% | 0.78% | ||
Source: Cushman & Wakefield Sonnenblick Goldman. | |||||
Property Type | Mid-Point of Fixed Rate Commercial Mortgage | ||||
12/31/10 | 1/5/12 | 1/26/12 | |||
Multifamily - Non-Agency | +190 | +205 | +210 | ||
Multifamily – Agency | +200 | +200 | +205 | ||
Regional Mall | +175 | +245 | +245 | ||
Grocery Anchor | +190 | +240 | +240 | ||
Strip and Power Centers |
| +255 | +255 | ||
Multi-Tenant Industrial | +190 | +245 | +255 | ||
CBD Office | +180 | +250 | +240 | ||
Suburban Office | +190 | +265 | +260 | ||
Full-Service Hotel | +290 | +300 | +290 | ||
Limited-Service Hotel | +330 | +310 | +315 | ||
10-Year Treasury | 3.47% | 2.00% | 1.97% | ||
Source: Cushman & Wakefield Sonnenblick Goldman. | |||||
Property Type | Mid-Point of Floating-Rate Commercial Mortgage | ||||
12/31/10 | 1/5/12 | 1/26/12 | |||
Multifamily – Non-Agency | +250-300 | +200-250 | +200-250 | ||
Multifamily- Agency | +300 | +220-265 | +220-265 | ||
Regional Mall | +275-300 | +250-350 | +210-265 | ||
Grocery Anchored | +275-300 | +240-325 | +200-275 | ||
Strip and Power Centers |
| +250-350 | +225-300 | ||
Multi-Tenant Industrial | +250-350 | +270-350 | +225-305 | ||
CBD Office | +225-300 | +275-350 | +225-300 | ||
Suburban Office | +250-350 | +300-350 | +250-325 | ||
Full-Service Hotel | +300-450 | +375-475 | +350-425 | ||
Limited-Service Hotel | +450-600 | +375-550 | +400-500 | ||
1-Month LIBOR | 0.26% | 0.30% | 0.27% | ||
3-Month LIBOR | 0.30% | 0.58% | 0.55% | ||
* A dash (-) indicates a range. | |||||
Source: Cushman & Wakefield Sonnenblick Goldman. | |||||
Year-to-Date Public Equity Capital Markets
DJIA (1): +5.28%
S & P 500 (2): +6.94%
NASDAQ (3): +11.54%
Russell 2000 (4):+12.18%
Morgan Stanley U.S. REIT (5):+8.95%
(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 | 2/5/12 | |
3-Month | 0.12% | 0.01% | .07% |
6-Month | 0.18% | 0.06% | .09% |
2 Year | 0.59% | 0.24% | .23% |
5 Year | 2.01% | 0.83% | .77% |
10 Year | 3.29% | 1.88% | 1.92% |
