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6A — April 24 - May 14, 2015 — Spring Preview — M id A tlantic
Real Estate Journal
M ortgage
By R. Brenner Green, Real Property Capital, Inc. The current commercial mortgage market
I
f you ask pretty much any borrower, lender or broker what they
couple of new products over the last three to six months designed to compete directly
the last several years has endured beyondmost every- one’s expectations. This is great news for commercial real estate markets not only on a macro level (just look at the price of almost any REIT stock over the last five years), but for smaller time individual investors and de- velopers as well. However in many respects, things are notably different than they were last time around and it is worth taking a mo- ment to contemplate some of these differences the next time you are in the market
for financing. First and most impor- tantly, even as an experi-
array of options right now for just about any property that demonstrates strong
t h i n k o f the financ- i n g ma r - ke t the s e day s , t he resounding reply is that there is a lot o f capi ta l out there.
“There is a healthy and diverse array of options right now for just about any property that demonstrates strong cash flow, with banks, life companies, CMBS and the GSE’s competing for business.”
R. Brenner Green
with some of the other mar- ket segments to whom they have been losing business. Additionally, a number of balance sheet lenders tied to private equity shops and hedge funds have rolled out alternate permanent loan programs designed to com- pete with CMBS but with more flexible terms on legal structure and prepayment penalty. In the world of commer- cial banking, the effects of increased regulation, primarily in the form of the Dodd-Frank Act, are having far reaching effects and creating unexpected consequences. Lenders from institutions that might con- sider themselves to be direct competitors often look at the same deal and come back with wildly differing quotes, and for reasons that it would have been impossible to pre- dict beforehand. Therefore, it pays to shop around. The overwhelming majority of time, we are finding a deal that exceeds the expectations of the cli- ent based on what we origi- nally said we could do. But it takes turning over more rocks that one might expect in what feels on the surface like an “easy money” envi- ronment. This is very much unlike how things were before the recession, when lenders tended to quote right on top of one another and it felt a little bit like a popularity contest. So if you are not getting the answer you are looking for from your lender or broker, turn over more rocks until you do, and it will be worth it in the end. R. Brenner Green is a 15 year veteran in com- mercial real estate fi- nance and president of Real Property Capital, Inc., a full service com- mercial mortgage bank- ing firm based in the Philadelphia suburbs. n
enced mortgage banker it is becoming difficult to predict which lender will win the bid on the most routine fi- nancing assignments. There is a healthy and diverse
cash flow, with banks, life companies, CMBS and the GSE’s competing for busi- ness. Notably with respect to the GSE’s, Fannie and Freddie have rolled out a
All sectors of the capital markets are now firing on all cylinders and the historic low rate environment that we have experienced over
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Real Property Capital is a Philadelphia based full service commercial mortgage banking firm with a regional focus and national capabilities. Our business model emphasizes client satisfaction through a high-touch, analytical approach that distinguishes us from the competition. Learn more about our distinct approach and proven track record of success at www.realpropertycapital.com.
FOR MORE INFORMATION: R. Brenner Green, President 75 East Butler Avenue • Ambler, PA 19002 • 610-456-9644 • bgreen@realpropertycapital.com
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