12A — August 15 - 28, 2014 — M id A tlantic
Real Estate Journal
www.marejournal.com
M ultifamily F inancing By Mark Scott, Commercial Mortgage Capital
Market back in full swing
A
s we head deeper into the summer months, business - which has
quarter. In addition, private payroll provider ADP noted that July marked the fourth straight month of job gains above 200,000. According to the Bureau of Labor Statis- tics, professional and business services added 47,000 jobs (and 648,000 over the past 12 months), manufacturing gained 28,000, retail trade upped by 27,000 and con- struction increased by 22,000. Employment in leisure and hospitality changed little in July, but has added 375,000 jobs over the year. In light of these positive
economic signals, it seems clear that the Fed will raise rates sooner rather than later.
Washington. “The Committee currently judges that there is sufficient underlying strength
inception of the current as- set purchase program, the Committee decided to make a further measured reduction in the pace of its asset pur- chases. Beginning in August, the Committee will add to its holdings of agency mortgage- backed securities at a pace of $10 billion per month rather than $15 billion per month, and will add to its holdings of longer-term Treasury securi- ties at a pace of $15 billion per month rather than $20 billion per month.” Additionally, the Commit- tee noted that if incoming information broadly supports the its expectation of ongoing improvement in labor market conditions and inflation mov- ing back toward its longer- run objective, the Committee will likely reduce the pace of asset purchases in further measured steps at future meetings. Loan spreads are tighten- ing due to intense competi- tion and slowly rising rates. The Fed is signaling we are going higher soon with the economic pickup we see now. The reduced spread in loan rates translates to a reduc- tion between the cost of funds for the lender and the rate at which these funds are lent out. Lending institutions can reduce their spread in response to factors such as more competition from other creditors, less perceived risk in the lending market due to favorable economic conditions or increased liquidity in the secondary market for these loans. In general, we’ve seen a very competitive marketplace with a great deal of bidding. While certain lenders have hit their budget, a number have yet to do so. Government Sponsored Enterprises Fannie Mae and Freddie Mac, in particular, are aggressively putting out money, in addition to some life companies. Thanks to favorable mar- ket conditions and a looming interest rate hike, now is the time for borrower’s to lock in today’s low rates with a seasoned mortgage profes- sional in order to get the best execution. Mark Scott is principal of Commercial Mortgage Capi- tal, based in Livingston, NJ. He can be reached at mscott@ newcommercialmortgage. com or 973-716-0006. n
already been strong - will ramp up even further. The U. S . e c on - omy added 209,000 jobs in July and grew at an annua l i zed
“Thanks to favorable market conditions and a looming interest rate hike, now is the time for borrower’s to lock in today’s low rates”
Meanwhile, the Federal Open Market Committee will con- tinue reducing its monthly pace of bond buying by an- other $10 billion, according to a statement released on July 30, 2014, following its two-day policy meeting in
in the broader economy to support ongoing improvement in labor market conditions. In light of the cumulative progress toward maximum employment and the improve- ment in the outlook for labor market conditions since the
Mark Scott
rate of 4% in the second quarter of 2014, the Com- merce Department said. This news followed a disappointing 2.1% contraction in the first
Over $200,075,000 in Closed Loans Many Thanks to our Valued Clients and Lenders.
Mark M. Scott Principal
$11,250,000 120 Units New Jersey
$9,750,000 82 Units New Jersey
$4,000,000 103 Total Units New Jersey
CMC DELIVERS FOR ITS CLIENTS. CALL US TO SEE HOW OUR CORRESPONDENT AND LONGTIME LENDER RELATIONSHIPS CAN HELP YOU ACHIEVE YOUR FINANCIAL GOALS: MARK M. SCOTT, Principal mscott@newcommercialmortgage.com
$23,000,000 159 Units New Jersey
$19,000,000 116 Units New Jersey
$13,000,000 140,000 SF Office
615 West Mount Pleasant Ave. Livingston, New Jersey 07039 Commercial Mortgage Capital (973)716‐0006 Office (973)215‐2409 eFax (201)787‐7111 Mobil e www.newcommercialmortgage.com
$18,000,000 400 Units New Jersey
$8,400,000 208 Units New Jersey
$23,250,000 178,150 SF Office New York
$35,000,000 150 Units New Jersey
$4,500,000 109 Units Ohio
$3,100,000 80 Units Texas
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