If I am any sort of leading indicator then times are getting a lot better. Just in the last week I have had calls from two serious developers asking for my assistance to raise construction debt for ground-up hotels/retail. Both are in terrific locations, they have excellent sponsorship, the projects make enormous economic sense, and they will have low leverage. Just that these are the sorts of calls I am getting is very indicative of the psychology. Up to now I only got calls asking me to advise on workouts and restructuring and refinancing. I just was able to get a commitment on a $110 million portfolio loan for hotels which included capital to complete the last bit of construction on a hotel in a secondary location.

I was one of those who thought that ground up construction, especially for hotels, would not happen for another two years, but here we are. I think I will be able to arrange the financing for both now. This is not to suggest that everyone can now go find construction loans for their new hotel, retail or office project. That is not going to happen. These are both unique in quality of location and quality of project, and sponsorship.

The enormous shift in thinking to a positive tone in just the past few weeks is astonishing. In the restructurings I am advising on, the attitude of the banks is now shifted noticeably to, let’s find solutions and work to build the client relationship so we can do more business in the future. That is opposed to, pay down your loan and don’t even think of asking for anything new for a long time. In one advisory client situation, we actually have two banks vying to be cooperative on the restructure to be able to keep their client happy so he will bring new deals to them. This is not to suggest they are underwriting poorly or rolling over or being easy. They are not. It is simply the attitude shift to, let’s figure out how we can solve this together so we all go away happy.