Latest Lending Numbers

The numbers were never going to be that promising. Still. New figures from Newmark show that commercial real estate debt origination volumes were off 52 percent annually in the second quarter of 2023, and the number of lenders in the market is considerably smaller than 12 months ago. Also for today, more extreme storms are hitting the Northeast. That means more resiliency challenges for buildings and cities.

These stories are part of our Daily Round Up, Click here to get it delivered straight to your inbox.

— Tom Acitelli, Deputy Editor

CRE Lending Down 52 Percent Annually: Newmark

If the headlines hinted at struggles in commercial real estate, then just wait until you see the data. A second quarter 2023 U.S. capital markets report from Newmark found CRE debt origination volumes have declined by 52 percent year-over-year, and that the current market has 32 percent fewer lenders than it did at this time last year. Moreover, while private equity sits on a record $219 billion of dry powder, that might not be enough to stave off the wave of $625 billion in CRE debt maturing over the next three years. “The market has been in a state of continuous change and uncertainty,” David Bitner, executive managing director of global research at Newmark, told CO. “Lenders demand lower [loan-to-values] , and higher [interest] rates, and are overall much more selective on what deals they will finance. “Investors are asking for both lower prices when they are buying and, at the same time, have been hesitant to meet the market when selling,” he added.

Read the rest of the story

Northeast Flooding Confronts Commercial Real Estate With Severe Challenges

This summer, the United States confronted a deluge of wildfires, floods and heat waves that battered cities nationwide — including locations that least expect it. In the Northeast, Vermont was inundated by a two-day July storm that pummeled sections of Montpelier, the state’s capital, and rural towns. Simultaneously, catastrophic rains struck other New England states, as well as parts of Pennsylvania and New York, resulting in widespread damages, evacuations and even death. For a summer deemed the hottest on record, the rainfall-driven flooding was hardly a reprieve from the severe heat, causing its own kind of damage and destruction to infrastructure, crops and homes. These deluges have forced the Northeast to weather severe weather — and reckon with a future it was not designed for. Unlike coastal states, or the lowland Southern region bordering the Gulf of Mexico, Vermont and Pennsylvania both sit inland in areas that, at first glance, are less at risk of flooding.

Read the rest of the story

Enjoying these stories on all things CRE? Unlock unlimited access to our content?with a subscription. And for a daily version of this newsletter,?sign up here.