With the demise of some of the biggest Wall St lenders, as well as the severe contractions of some of the commercial finance companies, there is a huge gap of capacity in the lending market now that real estate values and cash flows are once again on the upswing. There is not going to be the flood of distressed paper and properties that we all had anticipated, and now that banks are in much better balance sheet condition, they are in a better position to find ways to workout problems with their better customers. Most of the really bad loans either have been or are in the process of being dealt with. While there are still hundreds of billions of loan maturities yet to come, it appears from situations I have been involved with as an advisor, that further extensions and modifications are continuing. At some point all of these loans do need to be refinanced. It is also clear that a lot of loans will not qualify for CMBS executions over the next few years with the better and tighter underwriting standards.

There are inevitably people who recognize a need and move to fill it. A number of experienced teams are now attempting to raise capital; to form new lending platforms. Some are intending to stay focused on just recreating commercial lending operations focused on doing traditional $5 to $50 million real estate commercial finance lending. Others are intending to build much bigger platforms over time by starting with straight commercial lending then expanding to include mezzanine, and eventually CMBS platforms.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?


NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2024 ALM Global, LLC. All Rights Reserved.