CRE Analyst的动态

As interest rates continue to climb, we're seeing significant shifts in the commercial real estate lending landscape. Delinquency rates are rising across various asset classes, and while office loans are facing well-documented challenges, it's the less obvious sectors that could be facing even steeper climbs. Take a look at this riddle: Which loan type has seen a 149% increase in delinquencies, yet remains under the radar for many? This serves as a stark reminder that we must keep a close eye on not just the usual suspects, but also the quieter players in the market. What are your thoughts on where this is headed?

The May office loan maturity monitor is here: https://lnkd.in/e_vhUuTt This month, economists Matt Reidy CFA, Christopher Rosin, Kevin Fagan, and Twinkle Roy, PhD analyze the $2,247 million CMBS office loans that reached fully extended maturity last month. Discover which factors correlate with higher rates of payoff, take a peek into what the next 12 months hold, and see how office compares to other property types. #OfficeLoans #CMBS

As rates surged up, my troubles begin. I’m newer on the scene, but not SASB’s kin, Packaged and sold, yet quieter the tale. Outgrowing office in troubled scale, What type of loan am I? Office loan stats: -- Delinquency rate: 8.1% -- Pre-Covid delinquency rate: 6.1% -- Trend*: +92% -- Outstanding balance: $200B Mystery loan type stats: ?-- Delinquency rate: 2.8% -- Pre-Covid delinquency rate: 0.1% -- Trend*: +149% -- Outstanding balance: $25B * avg increase over last two years

For Lenders and Borrowers in the office market, will interest rate relief or tenant demand return soon enough? If not, what is your strategy to move your office investment forward? Directed Capital is actively evaluating opportunities to invest in office debt - either by acquiring existing loans from banks and other lenders, providing "rescue" financing to impacted borrowers, or originating acquisition financing for new owners at a reset basis. Please reach out to Kevin Twomey for loan sales or Kyle Moore for loan originations.

??In 2023, 20% of CMBS office loans that were slated to mature had become delinquent and failed to pay off or get extended by the end of that year. Retail had the second-highest share of distress, with 11% of maturing loans becoming delinquent last year. Based on the office default rate for maturing loans, we estimated that roughly $4 billion of the $20 billion in office loans slated to mature through the first two quarters of 2024 could become delinquent and would push the office delinquency rate above 8% by mid-2024, all else equal. Read Trepp, Inc.'s analysis here: https://hubs.li/Q02CZcB70 This research comes from Trepp and Commercial Real Estate Direct's 2024 edition of The Mid-Year Magazine. Download the magazine here???https://hubs.li/Q02CZjhx0 #Trepp #CMBS #CRE #CommercialRealEstate #Office #Retail #Lodging #Multifamily #Industrial #Maturities #Delinqeuncy

"NYC's Second Largest CMBS Office Loan Sent to Special Servicing in May" Read the full article below..

It's been over a decade... We haven’t seen borrowing rates this high in over ten years, and vacancy rates in office are at or near historic highs in many regional markets. To make matters worse: Office Loan Delinquencies January 2023: 1.86% Vs. Office Loan Delinquencies January 2024: 6.3% The 4.44% jump in loan delinquencies over the past 12 months means that we’re seeing more and more landlords attempt to ‘hand bank the keys’ of their office properties back to their bank. Given the hundreds of billions in office loan debt coming due over the next few years, we expect delinquencies to continue to rise over the coming months. What does that mean for #commercialtenants and #businessleaders as you negotiate your next #commercialrealestate lease? Do your homework! 1. 30%-40% of the time you can get a clear picture of the financial strength of your landlord 2. Understand all of the driving factors for both the economy and how it impacts commercial real estate 3. Protect yourself with a strong SNDA clause in your lease agreement. Check out #10 on this Inc. Magazine article by ? Jonathan Keyser for more on SNDA language: https://hubs.la/Q02kbZx60

Commercial property price declines have focused sharply on the office sector which adds to uncertainty around the performance of office loans. My colleague Alexis Maltin shows here that much of maturing office debt in the near term will be that from the CMBS originators. Cuts in the Fed Funds rate may simply not be enough to save some of these loans. https://ms.spr.ly/6042mmYJ6 MSCI Real Assets #CRE

Fellow #CRE member, Lonnie Hendry, CRE of #Trepp, makes an appearance on #SquawkBox to talk stress in #commercialoffice debt in the USA. TL;DR 1) Loan modifications jump to the highest in two years 2) There is still $30B in CMBS maturing in the sector by the end of 2024 3) "Higher for longer" may mean government intervention The key question is, "will all the #drypowder on the sidelines step in?" My thoughts? NO! While we are bouncing around a bottom, there has not been a capitulation event. While #privatecredit is ramping up, many funds are looking towards 2025 for deployment. Map this against the industry slogan of "Stay Alive 'til '25!" and you start to see how this risk exposure might play out.

Early data suggests an improvement in payoff rates for maturing office loans. While the overall 2023 rate was 35%, January and February of 2024 saw a jump to 48%. This doesn't erase concerns, with a significant amount of office debt maturing this year, but it offers a potential positive sign for the future of the sector: https://bit.ly/4cF3Rw1