Term Sheet: No near-term rate relief seen; Apollo’s $400m hotel loan; CMBS delinquencies jump
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The Federal Reserve is expected to follow a higher-for-longer interest rate strategy; Apollo Global finances QIA's acquisition of the Park Lane hotel in New York; the jury is still out on the impact of the SEC's new rules for private fund advisers on the commercial real estate space; and more in this week's Term Sheet.
They said it
“We’ll raise the bar for one of New York City’s signature industries and breathe new life into a key waterfront site”?
Michael Franco, president of Vornado Realty Trust , told the?Wall Street Journal?on Wednesday. He was speaking about the New York-based real estate investment trust’s partnership with Blackstone to build the city’s first production studio complex on Pier 94 – a sign of the times for niche asset classes.
What’s new
Digging in its heels
The Federal Reserve chair Jerome Powell?underscored last week?at the central bank’s annual Jackson Hole Economic Symposium that there are no plans to cut interest rates until inflation is reduced to its 2 percent target, citing the continued strength of the US economy. This means the Federal Reserve will likely maintain a hawkish stance on monetary policy for the near-term, according to advisory Newmark’s 2Q 2023 Capital Markets?report, released last week. “The Federal Reserve has been clear that it does not anticipate any rapid reduction in rates, a message that financial markets have resisted taking to heart,” the report stated.
Apollo’s Park Lane play
Apollo Global Management, Inc. , via Athene Annuity and Life Company, provided $400 million of financing for the Qatar Investment Authority’s?acquisition of New York’s Park Lane Hotel?from Mubadala Investment Company for $622.9 million. Read more...
Watch this space
The Securities and Exchange Commission last week adopted?new rules?for private fund advisers investing under the Investment Advisers Act of 1940. The widely anticipated rules put into place requirements that include requiring private fund advisers to publish quarterly reports and annual audits of each of their funds to increase transparency for investors. The ultimate impact on commercial real estate is not yet clear..... read more
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Trending
The song remains the same
AEW CAPITAL MANAGEMENT last week released a?report?stating that Europe’s key real estate markets face a €93 billion debt funding gap in the 2023 to 2026 period. The analysis,?published this week?by affiliate?Real Estate Capital Europe, expands on a January report from the Boston-based investment management company that aimed to provide concrete metrics around the expected funding gap. The report also tackled another topic – the health of the European banking system. Read more here...
Data snapshot
Delinquency jump
The US commercial mortgage-backed securities delinquency rate increased to 4.16 percent in August, with a 23-basis point month-over-month increase, according to?data?from New York rating agency KBRA. See the graph here...
People
NewPoint expands origination team?
NewPoint Real Estate Capital this week added two senior origination professionals to its team. The Irvine, California-based commercial real estate finance company hired Laurie Morfin as a senior managing director and David Bleiweiss as a managing director. The duo joins from Bellwether Enterprise and Berkadia, respectively.
Borrower’s corner
Working with sellers
Tourmaline Capital Partners , which is building a portfolio of class A offices, has been able to get some deals done, despite a choppy capital market for the sector, by working with sellers. “Seller financing is what is facilitating some of the deals we are doing,” said Brandon Huffman, managing principal of the Philadelphia-based firm, in a?story?posted this week on?Real Estate Capital USA....
#realestatefinancing #cmbs #