We had TARP for residential, now comes commercial
We had TARP for residential, now comes commercial
A large percentage of CMBS loans made in 2005-2008 may not qualify for refinancing without substantial equity injections due to much tighter underwriting standards, massive price declines and declining cash flow.
Multifamily loan performance has been deteriorating at a dramatic pace, Parkus said, with Midwestern "rust-belt" states plus Florida, Georgia and Texas among the worst performing markets. Parkus also noted that the deterioration of office properties values are beginning to accelerate due to job cuts.
Exacerbated by declining consumer spending and the shrinking U.S. economy, retail vacancies will likely increase to new highs as bankruptcies, store closings and retail consolidation continues, the bond rating agency said.
Hotel CMBS Loan Performance Deteriorating Rapidly
In a report issued on hotel loans held in commercial mortgage-backed securities by DBRS, the bond rating agency noted that, in a declining economy, commercial real estate investors are seeking long-term leases, low tenant rollover, low expense ratios and the ability to pass along increasing operating expense to tenants. Unfortunately, hotel properties offer none of these features.
"News coming out of the hotel market is, quite simply, not good. Well, bad actually. No, make that terrifying," the bond rating agency said. "Predicting hotel performance over the next 12 to 18 months is like juggling chainsaws while riding a unicycle." Most informed market participants seem to be gathering consensus around a high single-digit percentage decrease for revenue per available room (RevPAR). Given the apparent inability for most individuals to grasp just how bad the economy is and how bad it will get, it would not be surprising to see decline in RevPAR by well more than 10% in 2009, DBRS said.
We had TARP for residential now comes commercial - To learn more about this author, visit Carl Moore's Website.
Like this article? Share it with your friends
Unlike residential loans, which fund the construction of homes and development of unused land, commercial real estate and business loans finance a wide gamut of economic activity. And many banks, after the collapse of the home-building industries in 2006 and 2007, shifted their resources to commercial lending.
A large percentage of CMBS loans made in 2005-2008 may not qualify for refinancing without substantial equity injections due to much tighter underwriting standards, massive price declines and declining cash flow.
Multifamily loan performance has been deteriorating at a dramatic pace, Parkus said, with Midwestern "rust-belt" states plus Florida, Georgia and Texas among the worst performing markets. Parkus also noted that the deterioration of office properties values are beginning to accelerate due to job cuts.
Exacerbated by declining consumer spending and the shrinking U.S. economy, retail vacancies will likely increase to new highs as bankruptcies, store closings and retail consolidation continues, the bond rating agency said.
Hotel CMBS Loan Performance Deteriorating Rapidly
In a report issued on hotel loans held in commercial mortgage-backed securities by DBRS, the bond rating agency noted that, in a declining economy, commercial real estate investors are seeking long-term leases, low tenant rollover, low expense ratios and the ability to pass along increasing operating expense to tenants. Unfortunately, hotel properties offer none of these features.
"News coming out of the hotel market is, quite simply, not good. Well, bad actually. No, make that terrifying," the bond rating agency said. "Predicting hotel performance over the next 12 to 18 months is like juggling chainsaws while riding a unicycle." Most informed market participants seem to be gathering consensus around a high single-digit percentage decrease for revenue per available room (RevPAR). Given the apparent inability for most individuals to grasp just how bad the economy is and how bad it will get, it would not be surprising to see decline in RevPAR by well more than 10% in 2009, DBRS said.
We had TARP for residential now comes commercial - To learn more about this author, visit Carl Moore's Website.
Like this article? Share it with your friends
 | |
 |
No article feedback found. |
| |
Leave Your Feedback |
 | |
| |||
|
For an online Car Loan Calculator and finance for a cheap car loan. Get approved on car loans or car finance in Australia with cheap bank car loans and finding a car finance broker. Commercial car loans including business car finance and car lease. Car Loan Calculator has information on finance companies and getting the right cheap car loan from banks at best car loan rates and a online car loan calculator for all finance in Australia. Get the best car finance with our help at Car Loan Calculator and Finance Ezi. - Visit Richard Jefferies's Website |
|||
|
To learn more about the Evan Elite Author Program please contact us. | |||
 | |
|  |
Subscribe to Carl's articles
 | |
|
|  |
 | |
|
| |
 | |||||||
|
 | ||
 |
||
 |
||
 |
||
|
| ||
 |
| Have you written articles that would be of value to entrepreneurs? Become an expert on our site by publishing them! Expose yourself to a wide audience, drive more traffic to your website and get more sales! Click Here for details. |
|
|
 |
| Modeling the Masters: Learn the true secrets behind Walt Disney's business success factors & grow your company! Video produced by Phanta Media |
|
|
 |
"Learn straight from Evan how you can Make a Full Time Income (And More) from a Website"
Click Here To Learn More |
|
|
|
|
Get advice & tips from famous business owners, new articles by entrepreneur experts, my latest website updates, & special sneak peaks at what's to come!
|
|
|
 Organized in 10 mins Get Working Capital Put Yourself Into the Top 3% 10 Ways To Go International Super Productivity |
|
 | ||
 |
Write The PR
Press Release Builder | |
 |
Top 50 Debt Blogs
Learn To Get Out Of Debt | |
| ||
 | ||||
| ||||
|
| ||||
| ||||
|
|
|
|
|
||||||||||||
|
Email us your ideas on how to make our website more valuable! Thank you Sharon from Toronto Salsa Lessons / Classes for your suggestions to make the newsletter look like the website and profile younger entrepreneurs like Jennifer Lopez and Sean Combs!
|
|
|
