Commercial RE Lending
Signs of Life Emerge in Commercial Real Estate Lending Market
Source: nreionline.com
"Several positive developments appear to be emerging in the real estate capital markets, providing a glimpse of optimism as investor sentiment begins to rebound.
Case in point: Simon Property Group, an A-rated blue chip real estate investment trust (REIT) with a strong balance sheet, issued $650 million of 10-year unsecured debt at 10.8% in March.
In May, Simon issued $600 million of 5-year notes at 7%. The nation�s largest shopping center owner issued another $500 million of 5-year notes at 5.5% in August. Several other public REITs also were able to raise large amounts of both secured and unsecured debt financing.
Meanwhile, the commercial mortgage-backed securities (CMBS) market has shown signs of life and spreads have narrowed. Commercial mortgage rates have tightened up. We believe these signs are pointing to a thawing in the real estate capital markets."