Jim Costello, Senior Vice President with Real Capital Analytics, appears on The Commercial Real Estate Show to discuss how commercial real estate lenders are feeling in the today’s economic environment. Highlights of this video include:
- Lenders are currently stuck in same world as equity investors, questioning whether to loan at inflated values as compared to the not so distant history
- Lending standards are nevertheless remaining firm, but new entrants are increasingly competitive
- New entrants are less competitive, however, on first mortgages, participating more in mezzanine financing, etc.
- On regulation; can be a good thing, can be a bad thing
- Heavy handed response to housing crisis years back has resulted in seemingly over regulated lending
- This has hindered lending on commercial property
- Developers are being hit the hardest
- Thinks fear of supply driven downturns are overblown, but there are nevertheless pockets (of over supply)
- Office property strength and development is highly market specific
- Among commercial property segments, lenders are most anxious about retail and likely will be for a while