Headlines
Headlines and quotes we publish are intended to convey a sense of the terms and conditions present in the real estate capital markets.
“China Shapes an All-Asia Financial Center”
This rates a capital “A” for pretty amazing.
The global banker’s vocabulary was expanded last year with the addition of three new terms, as follows:
- “Redbacks” (offshore deposits of Renminbi (China’s currency) tradable in Hong Kong);
- “Dim Sum Bonds” (bonds denominated in offshore Renminbi); and
- “Synthetic RMB bonds” (bonds denominated in offshore Renminbi, but paid in US dollars).
And in April 2011, the first Renminbi-denominated initial public offering was launched in Hong Kong.
Monday’s Numbers
The Commercial Mortgage Alert Trepp weekly survey (below) of 15 active portfolio lenders remained literally “frozen in place” over the past few weeks. All-in cost remains in 5.00 to 5.25 percent range.
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 | 4/29/11 | |
Office | 342 | 214 | 177 |
Retail | 326 | 207 | 169 |
Multifamily | 318 | 188 | 151 |
Industrial | 333 | 201 | 166 |
Average Asking Spread | 330 | 203 | 166 |
10-Year Treasury | 3.83% | 3.29% | 3.29% |
The Cushman & Wakefield Sonnenblick-Goldman survey for the period ended April 28 showed spreads narrowing 10 to as much as 25 basis points; it’s hard to imagine mortgages being priced more attractively.
Property Type | Mid-Point of Fixed Rate Commercial Mortgage Spreads For 5 Year Commercial Real Estate Mortgages | ||||
12/16/10 | 2/15/11 | 3/2/11 | 3/31/11 | 4/28/11 | |
Multifamily - Non-Agency | +270 | +250 | +245 | +245 | +230 |
Multifamily – Agency | +280 | +255 | +250 | +250 | +205 |
Regional Mall | +280 | +260 | +260 | +260 | +260 |
Grocery Anchored | +280 | +260 | +260 | +260 | +245 |
Multi-Tenant Industrial | +270 | +270 | +265 | +265 | +245 |
CBD Office | +280 | +260 | +260 | +260 | +250 |
Suburban Office | +300 | +270 | +270 | +270 | +260 |
Full-Service Hotel | +320 | +300 | +300 | +300 | +280 |
Limited-Service Hotel | +400 | +330 | +325 | +325 | +320 |
5-Year Treasury | 2.60% | 2.36% | 2.17% | 2.23% | 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 | 3/2/11 | 3/31/11 | 4/12/11 | 4/28/11 | |
Multifamily - Non-Agency | +190 | +180 | +180 | +180 | +180 |
Multifamily – Agency | +200 | +185 | +185 | +185 | +175 |
Regional Mall | +175 | +180 | +180 | +180 | +180 |
Grocery Anchor | +190 | +185 | +185 | +181 | +175 |
Multi-Tenant Industrial | +190 | +190 | +190 | +190 | +180 |
CBD Office | +180 | +180 | +180 | +180 | +180 |
Suburban Office | +190 | +190 | +190 | +190 | +190 |
Full-Service Hotel | +290 | +230 | +230 | +230 | +220 |
Limited-Service Hotel | +330 | +260 | +260 | +240 | +240 |
10-Year Treasury | 3.47% | 3.47% | 3.45% | 3.51% | 3.34% |
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 | 3/2/11 | 3/31/11 | 4/12/11 | 4/28/11 | |
Multifamily – Non-Agency | +250-300 | +225-300 | +225-300 | +225-325 | +225-315 |
Multifamily- Agency | +300 | +250-300 | +250-300 | +250-310 | +250-310 |
Regional Mall | +275-300 | +225-275 | +225-300 | +225-300 | +225-300 |
Grocery Anchored | +275-300 | +225-275 | +225-300 | +225-300 | +225-300 |
Multi-Tenant Industrial | +250-350 | +250-350 | +250-350 | +250-350 | +250-350 |
CBD Office | +225-300 | +225-300 | +225-300 | +225-300 | +225-300 |
Suburban Office | +250-350 | +275-350 | +275-350 | +275-350 | +250-350 |
Full-Service Hotel | +300-450 | +350-450 | +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% | 0.24% | 0.22% | 0.21% |
3-Month LIBOR | 0.30% | 0.31% | 0.30% | 0.28% | 0.27% |
* A dash (-) indicates a range. | |||||
Source: Cushman & Wakefield Sonnenblick Goldman. | |||||
Year-to-Date Public Equity Capital Markets
DJIA (1): +9.17%
S & P 500 (2):+6.56%
NASDAQ (3): +6.58%
Russell 2000 (4):+6.34%
MSCI U.S. REIT (5):+8.76%
_____
(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 | 5/7/2011 | |
3-Month | 0.12% | 0.01% |
6-Month | 0.18% | 0.06% |
2 Year | 0.59% | 0.55% |
5 Year | 2.01% | 1.86% |
10 Year | 3.29% | 3.15% |
