Posts tagged Investment Trends
Acquisitions – Confirming the Rent Roll
Oct 28th
It is hard to say which single document is the most essential to review when purchasing an income property. However, as the prime source of property revenue, the rent roll is clearly one of the most critical. More >
Commercial Real Estate Returns – Leading Indicators, Return of Debt and Brokerage Activity
Sep 23rd
America and the world’s economies were thrown into the sharpest recession ever by the overnight disappearance of debt. The appetite for debt among the world’s investors instantly vanished and remained absent for 18 months. This of course caused the smoothly running real estate machine to seize. The deal making world became barren. No one knew where to turn or what we could do to spark transactional activity. More >
Due Diligence Pointers
Sep 16th
For the Seller, the Due Diligence process is one of the most critical parts of an investment sale transaction and could make or break a deal, depending upon how it’s handled. As such, an informed Seller can be prepared to respond to most situations raised by the Buyer. More >
The ISG Team
Aug 25th
Since this is the NAI Global Corporate Blog, I feel it’s incumbent upon me to brag a little about NAI Global’s Investment Services Group.
NAI Global completes over $45 billion in transactions in a typical year, including over $10 billion in investment sales. These transactions range from large institutional-quality assets and portfolios to mid-size and smaller properties suitable for regional and local private investors. To best serve its institutional and sophisticated private clients, we created our Investment Services Group (the “ISG”), which is composed of NAI’s most senior investment advisors throughout the U.S. More >
CoStar reports Auction Sales since Early 2009
Aug 9th
Open the Wednesday real estate section of The Wall Street Journal or an email communication from one of the major real estate business journals and you can’t miss seeing that dozens of commercial real estate auctions occurring weekly throughout the United States. More >
Loan Sales Take Off – $1B Portfolio Now Available
Aug 9th
Loan sales represent a large volume of the distressed asset transactions that have been closing so far in 2010. Lenders and special servicers’ decisions to hold or sell specific loans are generally based on a net present value (NPV) analysis of each asset. This critical analysis accounts for the respective costs to the lender if the loan is held or acquired as REO; the capital required to then stabilize and manage the asset; and the time required to foreclose (in some states, this can be longer than a year). With certain markets and asset values of some property types continuing to deteriorate, the conclusion is often that a loan sale makes more sense to the lender than a hold. More >
Bridging the Bid Ask spread in Difficult Times
Jul 21st
A common scenario in today’s real estate landscape is the following situation:
- A property has lost a significant part of its value due to market conditions.
- The borrower is in violation of their loan covenants and is in default
- The Lender has its own financial problems
- The Owner is out of money, ideas and alternatives
- The property is in receivership; forclosure is looming
- A sale at market value can’t produce enough proceeds to solve anyone’s problem
- Ownership is concerned over personal guarantees
- Negotiations between parties are futile and fustrating
Sound familiar? More >
CMBS Servicing Definitions
Jul 16th
With so much current interest in CMBS debt and dealing with servicers to workout or buy troubled loans and foreclosed properties, it is useful to understand the roles of the various servicers for these loans after they have been securitized. As you will see from the following descriptions, the Special Servicers and the Directing Certificateholders (or B-Piece Buyers) have the most immediate control over the foreclosure and subsequent sale processes. More >
Recapitalizing an “Underwater” Hotel Deal
Jun 30th
The number of hotels that are “underwater” financially is substantial and growing. The challenges of today’s economic and capital market conditions has brought even solid, experienced operators to their knees. So when looking at investing in a hotel deal today, should you recapitalize the current owner or acquire the property and start over?
For starters, it’s helpful to analyze the subject hotel in comparison to its competitors. If the property is maintaining its relative pre-down-cycle position with its competitive set, you might conclude that the problem is less likely due to the operator. By interviewing ownership and key employees, reviewing property records such as quality scores and operating statements and physically inspecting the property, an experienced investor can come to a reasonable conclusion about whether or not to consider recapitalizing a current owner. More >
Economic Recovery Relieves Threat of Foreclosed Property Flood
Jun 21st
Everyone expected the floodgates of foreclosed properties to be opened by now, but it just hasn’t happened. And it doesn’t appear likely either. The fear that a massive wave of distressed property would hit a cash starved illiquid market has been forestalled. Instead the banks and their underwater borrowers have been given reprieve; as vast capital formation has occurred, product has slowly eked out into the market. In this now supply constrained-environment prices are moving up rather than crashing. The scarce core quality assets that have hit the market have had multiple bidders and realized cap rates up to 100 basis points lower than the bottom. More >
