IRVINE, CA—“There are lots of attractive pricing out there for borrowers, so some have false expectations.” That was according to Alexa Mizrahi, loan originator at Lone Oak Fund, at the RealShare Orange County conference last week, an event which drew nearly 700 attendees.
Mizrahi, along with other panelists during the capital sources and transactions panel, discussed the pressure to get the capital out, but at the same time, she said, “you don't want to be put into a position where you are underwater on a bunch of properties if there is a correction.”
Mizrahi cautioned that it is important to be sure the borrower still has skin in the game. “It is a frothy market right now on the lending and buying side and you have to maintain discipline even though there is pressure to do deals.”
Switching gears, when asked about about where the market is now and how much equity is in stabilized class A deals, Michael Sanchez, VP of commercial real estate at RealtyMogul.com, said that it is important to stick to the fundamentals of cash flow. “I still look at this as what are the rents today, what are the rents going to be upon completion of this business plan and what will it take in terms of dollars and execution,” he said.
Sanchez looks at what the building across the street is getting. “I am underwriting to a rent I know can be achieved today.”
The RealShare Conference Series is produced by ALM's Real Estate Media Group, which also publishes Real Estate Forum and GlobeSt.com.
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Natalie Dolce
Natalie Dolce, editor-in-chief of GlobeSt.com and GlobeSt. Real Estate Forum, is responsible for working with editorial staff, freelancers and senior management to help plan the overarching vision that encompasses GlobeSt.com, including short-term and long-term goals for the website, how content integrates through the company’s other product lines and the overall quality of content. Previously she served as national executive editor and editor of the West Coast region for GlobeSt.com and Real Estate Forum, and was responsible for coverage of news and information pertaining to that vital real estate region. Prior to moving out to the Southern California office, she was Northeast bureau chief, covering New York City for GlobeSt.com. Her background includes a stint at InStyle Magazine, and as managing editor with New York Press, an alternative weekly New York City paper. In her career, she has also covered a variety of beats for M magazine, Arthur Frommer's Budget Travel, FashionLedge.com, and Co-Ed magazine. Dolce has also freelanced for a number of publications, including MSNBC.com and Museums New York magazine.
