LOS ANGELES—“Not every deal works,” Robert Hodge, senior director at Marcus & Millichap tells GlobeSt.com. Although the market is flooded with capital, and every day new deals close with incredible terms—leverages reaching 85% or LIBOR below 3%—Hodge says that this isn't the norm, and generally, lenders are sticking to the fundamentals. An expert in debt souring, Hodge is moderating the Debt For Every Deal panel today at RealShare Investment & Finance in Downtown Los Angeles.

“Everyone wants to get competitive, but they want the good deals in the good locations. That's not every deal, and that is where is gets difficult,” Hodge says. “There are borrowers with credit issues from 2007 and 2008, and most lenders don't want to touch that. Then, there are lease roll overs that are putting deals at risk and lenders won't go to the leverage that borrowers need to be refinanced. Everyone wants to do an anchor tenant on main and main, but it is the properties in tertiary markets that are tough to do—and those deals still have to get done.”

There have been some concerns lately that, in an attempt to stay competitive, lenders have been ignoring the underlying fundamentals to win deals. Hodge says that this isn't the case for your average investor. “The institutional players out there, the high net worth individuals, the very large investors and the groups that have the experience and have done it are the ones getting bridge loans at high leverage and low cost to debt,” says Hodge. “There aren't a lot of people that can go out and get that debt. For the average investor, it is hard to get that debt.”