Top10Financing.com
info@top10financing.com

Got Questions about Financing?

Here's the best advice for small business owners, entrepreneurs and real estate investors.

Yes, Sign Me Up Now!!!
  • HOME
  • Our Blog
  • Starting a Business?
  • 6 Steps to Business Financing
  • Step 1: Take a Personal Inventory
  • Step 2: Know Your Credit Scores
    • Credit Repair
  • Step 3: Build Business Credit
  • Step 4: Prepare a Business Plan
    • Business Plans
  • Step 5: Identify the Financing Options
  • Step 6: Make the Pitch to the Right Financing Source
  • Business Financing Consultations
  • Take the Business Financing Quiz!!

Commercial Lending Crystal Ball for 2012?

12/19/2011

0 Comments

 
Year 2012 will see a continuation of improving lending conditions if commercial real estate values stabilize and borrowers find stable footing in the markets.  Owner-occupied properties, multifamily and stabilized, cash-flowing investment real estate will be the favored property categories.  Development and construction will still be industry laggards.  Private lending for business and real estate deals has blossomed in the past year as investors flee from the stock market looking for more sensible, safe, dividend-type investment vehicles.  No longer does private money always equate to near usurious interest rates and multiple point originations.

Industry experts expect Small Business Administration (SBA) lending to be active in 2012, particularly SBA 504. “I see a rush of SBA 504 refinances prior to the program’s scheduled end in September 2012. But I also wonder if the program will be extended or made permanent, a move that would make sense to me. On the other hand, the U.S. government does not seem capable of passing any legislation that makes sense, so I am not holding my breath,” says Michael D. Sneden, Executive Vice President at ValueXpress.

Government-sponsored multifamily programs (Fannie Mae, Freddie Mac and HUD) will continue to dominate the multifamily sector.  CMBS conduit loans will creep back into the lending forefront for multifamily properties that are ineligible for government-backed originations. Both of these options will provide excellent debt capital flux into the multifamily sector overall.  In addition, small-balance portfolio loan programs exist in the multifamily arena, making this property type a continued favorite of mine for smaller RE investors.

Commercial Mortgage-Backed Security (CMBS) conduit programs, which virtually disappeared a couple years ago as the secondary market dries up, should increase for 2012. But don't expect them to increase by leaps and bounds. "The CMBS market as a whole generated about $30 billion in CMBS loans in 2011 [a fraction of the 2005 - 2008 hay day], will grow to about $50 billion in 2012 [still a fracture of the peak volumes],” say Sneden.

In summary, although we saw some traction in commercial lending in 2011 compared to 2009 and 2010, the progress was slow.  I credit this progress much less to sane lenders' origination policies and more to credit-worthy borrowers coming out from under the woodwork.    So in 2011, the commercial lending market  improved for stabilized, income-producing and owner-occupied real estate, albeit very slowly.  In 2012, we would expect to see more loan originations as additional lending sources open up and existing lenders bring more sanity into their lending practices.
0 Comments

Your comment will be posted after it is approved.


Leave a Reply.

    Top10Financing News -Here is our blog:

    Archives

    February 2016
    January 2016
    December 2015
    October 2015
    September 2015
    August 2015
    July 2015
    June 2015
    September 2014
    July 2014
    October 2013
    September 2013
    July 2013
    May 2013
    March 2013
    December 2012
    November 2012
    August 2012
    July 2012
    June 2012
    May 2012
    April 2012
    March 2012
    February 2012
    January 2012
    December 2011
    November 2011
    October 2011
    September 2011


    Affiliate Disclosure: In some posts we may recommend products or services for which we receive compensation.  However, we only recommend products that we've either personally checked out or that come from people we know and trust. When you purchase something from a link in this blog, we may receive compensation, but the price to you is the same regardless of whether we are compensated.  Our first priority is to provide information and resources to help you  in your endeavors  (affiliate or otherwise).  Affiliate compensation helps to offset the costs associated with maintaining a high quality blog.
Affiliate Disclosure: On this website we may recommend products or services for which we receive compensation.  However, we only recommend products or services that we've either personally checked out or that come from people we know and trust. When you purchase something from a link, we may receive compensation, but the price to you is the same regardless of whether we are compensated.  Our first priority is to provide information and resources  (affiliate or otherwise) to help you in your business endeavors.  Affiliate compensation helps to offset the costs associated with delivering high quality information to you.
                              Copyright © 2011-2016, Asset Financing Group, Inc., All Rights Reserved
Photo used under Creative Commons from frankieleon