Comprehensive Capital Market Solutions For Commercial Real Estate NC CCIM – 2013 Commercial Real...
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Transcript of Comprehensive Capital Market Solutions For Commercial Real Estate NC CCIM – 2013 Commercial Real...
Comprehensive Capital Market SolutionsFor Commercial Real Estate
NC CCIM – 2013 Commercial Real Estate Forecast
Loans are subject to credit approval. Source: Commercial Quarterly Data Book – 3rd Q 2011 Mortgage Bankers Association
Commercial Banking 34%
CMBS, CDO, and other ABS Issues 24%
Age
ncy
and
GSE
s 16
%
Life Insurance
Cos 14%
State & Local Gov 2%
Others 10%
$2.38 Trillion, Q3 2012
Commercial / Multifamily Debt Outstanding Comparison By Investor Group
Commercial Banking 33%
CMBS, CDO, and other ABS Issues 26%
Age
ncy
and
GSE
s 14
%
Life Insurance
Cos 13%
State & Local Gov 7%
Finance Companies 2%
Others 5%
$2.37 Trillion, Q3 2011
Loans are subject to credit approval. Source: Commercial Quarterly Data Book – 3rd Q 2011 Mortgage Bankers Association
Commercial and Multifamily Mortgage Flows Net Change in Commercial and Multifamily Mortgage Debt Outstanding, by Sector (in Millions)
Loans are subject to credit approval.
Compared to Q3 2011……
• Q3 2012 origination volumes 7% lower.
• Borrowing slowed in Q3 despite low interest rates due to moderate pace of commercial transactions (retail and office) and a continued drop in loan maturities. Property types that increased were hotels (4%), industrial and healthcare (19%), multifamily (30%).
• Among investors, life company loans decreased by 32%, 8% increase for commercial banks, 30% increase for GSEs, no change in volume for CMBS.
Source: Commercial Quarterly Data Book – 3rd Q 2011 Mortgage Bankers Association
Commercial and Multifamily Mortgage Loan Originations
Loans are subject to credit approval.
Outstanding U.S. CRE Debt
Total Commercial and Multifamily = [$2.42 Trillion]
Insurance companies = [$338 Billion (14%)]
GSEs = [$369 Billion (15.25%)]
CMBS = [$579 Billion (24%)]
Banks/Thrifts = [$811 Billion (33.50%)]
Other = [$319 Billion (13.25%)]
Loans are subject to credit approval. Source: Commercial Quarterly Data Book – 3rd Q 2011 Mortgage Bankers Association
Quarterly Originations
Loans are subject to credit approval.
Quarterly Issuance of CMBS Billions of Dollars
Loans are subject to credit approval.
• $2.38 trillion in outstanding commercial/multifamily mortgage debt in Q3 2012, $6.6 billion higher than Q2 2012, as three of the four major investor groups increased their holdings.
• Fannie, Freddie, FHA, life insurance companies, and banks all increased their holdings and/or guarantees of commercial and multifamily mortgages, outpacing a decline in the balance of commercial and multifamily mortgages held in commercial mortgage backed securities.
Source: Commercial Quarterly Data Book – 3rd Q 2011 Mortgage Bankers Association
Commercial and Multifamily Mortgage Loan Market Share
Loans are subject to credit approval.
Based on UPB by Investor Group at end of Q3 2012
• Life Companies 0.12% (60+ days) (0.19% in 2011)
• Freddie Mac 0.27% (60+ days) (0.33% in 2011)
• Fannie Mae 0.28% (60+ days) (0.57% in 2011)
• Banks 2.93% (90+ days) (3.76% in 2011)
• CMBS 8.86% (30+ & REO) (8.92% in 2011)
Source: Commercial Quarterly Data Book – 3rd Q 2011 Mortgage Bankers Association
Delinquency Rates• DQ rates decreased for commercial and multifamily mortgage loans in Q3
• DQ rates on bank-held loans is at lowest level since beginning of 2009• DQ rates for CMBS continues to stabilize.
Loans are subject to credit approval.
CMBS Maturities$492 Billion over next six years
CMBS Maturities (In Billions)
Total ≤ 1.0x 1.0x - 1.19x > 1.20x LTV > 100%80%-100%
LTV LTV < 80%
2013 $ 55.75 $ 6.36 $ 5.35 $ 44.04 $ 14.49 $ 3.85 $ 37.35
2014 $ 44.10 3.35 4.85 35.94 3.70 3.09 37.31
2015 $ 83.05 7.06 9.05 66.94 7.14 5.90 70.01
2016 $ 121.09 11.02 8.48 101.60 11.62 7.02 102.44
2017 $ 142.77 18.56 26.13 98.08 17.56 16.70 108.50
2018 $ 22.15 0.75 0.91 20.48 0.60 0.84 20.71
2019 $ 23.14 0.88 1.57 20.68 1.69 1.23 20.22
Source: TREPP
Loans are subject to credit approval.
2012 What Was HotMultifamily – 80% LTV, 4% rate
Grocery-Anchored Retail – 75%, 4.25%
Office – 70%, rollover, TIs
Industrial – 70%, 20 year amort
2013 What’s HotMultifamily – 85%, 3.50%
Grocery-Anchored Retail – 75%, 4%
Office / MOB – 75%, rollover, focus on TIs
Industrial – 75%, rollover
Hospitality – 70%, 10.75% DY, 235bps over
Self-Storage – 75%
Credit Retail – fully amortizing to lease term
CMBS – 75%, A-B Structures down to 1.10x
2012 What Wasn’tUnanchored Retail – 60%, rollover
Hospitality/Lodging – go away
Self-Storage – 65% @ 9% caps
2012 What’s NotUnanchored Retail – 65%, historical tenancy
Loans are subject to credit approval.
Historical 10 Year Treasury Yield Curve, 1962 – 2013
July 198115.84%
1.38%July 2013
Loans are subject to credit approval.
10 Year Treasury Yield Curve, March 2011 to March 2012
10 Year Treasury Yield Curve, March 2012 to March 2013
3.54%
1.71%
2.27%
2.37%
1.38%
2.03%
-99bps
Loans are subject to credit approval.
Bob Hukill, Senior Vice President [email protected] | 919.871.6300
Velinda Dismukes, Assistant Vice President [email protected] | 919.871.6300
Wesley Fricks, Analyst [email protected] | 919.871.6300
Grandbridge Real Estate Capital – Raleigh Office
700 Spring Forest Rd, Suite 325Raleigh, NC 27609