Headlines
Headlines are normally self-explanatory; we hope the ones we publish will convey a sense of the terms and conditions present in the real estate capital markets.
“American Assets Trust Raises $564 Million in [REIT] IPO”
“AMB Property Corp. and Discuss ProLogis Merger”
Comment: Activity in the REIT sector captured investor interest last week with both a successful IPO and the potential for a “mega-Merger”. The question on everyone’s mind: what’s next?
Monday’s Numbers
The Commercial Mortgage Alert Trepp weekly survey (below) of 15 active portfolio lenders remained unchanged; both sides of the market (borrowers and lenders) seem content for now with spreads and rates where they are.
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 | 1/7/11 | 1/14/11 | 1/21/11 | ||
Office | 342 | 214 | 200 | 202 | 204 | |
Retail | 326 | 207 | 193 | 192 | 194 | |
Multifamily | 318 | 188 | 176 | 177 | 178 | |
Industrial | 333 | 201 | 188 | 187 | 188 | |
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Average Asking Spread | 330 | 203 | 189 | 189 | 191 | |
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10-Year Treasury | 3.83% | 3.29% | 3.38% | 3.40% | 3.45% | |
Source: Commercial Mortgage Alert; Trepp. | ||||||
Commentary regarding the Cushman & Wakefield Sonnenblick-Goldman Survey will be updated at the next reporting period.
Property Type | Mid-Point of Fixed Rate Commercial Mortgage Spreads For 5 Year Commercial Real Estate Mortgages | ||||
12/16/10 | 1/6/11 | 1/20/11 | |||
Multifamily - Non-Agency | +270 | +250 | +250 | ||
Multifamily – Agency | +280 | +260 | +260 | ||
Regional Mall | +280 | +260 | +260 | ||
Strip/Power Center | +280 | +265 | +265 | ||
Multi-Tenant Industrial | +270 | +270 | +270 | ||
CBD Office | +280 | +270 | +260 | ||
Suburban Office | +300 | +300 | +270 | ||
Full-Service Hotel | +320 | +320 | +300 | ||
Limited-Service Hotel | +400 | +375 | +350 | ||
5-Year Treasury | 2.60% | 2.07% | 2.05% | ||
Source: Cushman & Wakefield Sonnenblick Goldman. | |||||
Property Type | Mid-Point of Fixed Rate Commercial Mortgage Spreads For 10 Year Commercial Real Estate Mortgages | ||||
12/1610 | 1/6/11 | 1/20/11 | |||
Multifamily - Non-Agency | +190 | +190 | +190 | ||
Multifamily – Agency | +200 | +195 | +195 | ||
Regional Mall | +175 | +180 | +180 | ||
Strip/Power Center | +190 | +185 | +185 | ||
Multi-Tenant Industrial | +190 | +190 | +190 | ||
CBD Office | +180 | +180 | +180 | ||
Suburban Office | +190 | +190 | +190 | ||
Full-Service Hotel | +290 | +270 | +250 | ||
Limited-Service Hotel | +330 | +310 | +280 | ||
10-Year Treasury | 3.47% | 3.38% | 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 | ||||
12/1610 | 1/6/11 | 1/20/11 | |||
Multifamily – Non-Agency | +250-300 | +225-300 | +225-300 | ||
Multifamily- Agency | +300 | +275-300 | +250-300 | ||
Regional Mall | +275-300 | +250-275 | +250-275 | ||
Strip/Power Center | +275-300 | +275-300 | +275-300 | ||
Multi-Tenant Industrial | +250-350 | +250-350 | +250-350 | ||
CBD Office | +225-300 | +225-300 | +250-300 | ||
Suburban Office | +250-350 | +250-300 | +275-350 | ||
Full-Service Hotel | +300-450 | +350-450 | +350-450 | ||
Limited-Service Hotel | +450-600 | +400-500 | +400-500 | ||
1-Month LIBOR | 0.26% | 0.26% | 0.26% | ||
3-Month LIBOR | 0.30% | 0.30% | 0.30% | ||
* A dash (-) indicates a range. | |||||
Source: Cushman & Wakefield Sonnenblick Goldman. | |||||
Year-to-Date Public Equity Capital Markets
DJIA (1): +2.14%
S & P 500 (2):+1.21%
NASDAQ (3): +1.40%
Russell 2000 (4): -1.71%
MSCI U.S. REIT (5):+1.20%
(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 | 1/18/11 | |||
3-Month | 0.12% | 0.14% | ||
6-Month | 0.18% | 0.15% | ||
2 Year | 0.59% | 0.25% | ||
5 Year | 2.01% | 1.99% | ||
10 Year | 3.29% | 3.32% | ||
Source: Bloomberg LLP. | ||||
