CMBS lending is catalyst for market’s growth

TRD New York /
Mar.March 11, 2013 08:30 AM

Lending that occurred with the aid of commercial mortgage-backed securities has helped fuel the growth in the real estate market, Crain’s reported.

Some $19 billion worth of CMBS were issued in the first two months of 2013, roughly four times the volume that was issued in the first quarter of 2012, in an encouraging sign for a market that saw record delinquency rates in 2012. “It’s a key driver of sales, especially in New York, where we have these larger trophy-asset deals,” Douglas Mazer, the co-head of Wells Fargo’s CMBS lending group in Manhattan, told Crain’s. “”Borrowers and sellers on both sides will have the confidence to enter into these larger acquisitions knowing the CMBS financing will be there.” 

Supply of CMBS continues to rise, with big lenders such as JPMorgan Chase revising its CMBS forecast from $45 billion to $70 billion. While pre-crisis figures touched $230 billion, experts said that 2013’s estimates indicate that investors are looking for alternatives to Treasury bonds and other financial instruments.

In New York, major players such as Vornado Realty Trust and SL Green are taking advantage of the growing CMBS trend. Vornado is arranging a $707 million CMBS loan to refinance the retail section of 666 Fifth Avenue, sources told Crain’s, and SL Green recently refinanced 1515 Broadway with a $900 million CMBS loan. Tishman Speyer is also looking to arrange CMBS financing for its 32-story tower at 11 West 42nd Street, sources told Crain’s.

The Dodd-Frank Act — the federal statute drafted in the wake of the financial crisis to increase regulations over financial institutions – has placed additional constraints on CMBS, as The Real Deal previously reported. [Crain’s]  —Hiten Samtani


Related Articles

arrow_forward_ios
Vornado's Steve Roth and 220 Central Park South (Credit: Getty Images, iStock)

Free and clear: Vornado pays off debt at 220 CPS

Free and clear: Vornado pays off debt at 220 CPS
Vornado chairman and CEO Steven Roth, and 608 Fifth Avenue (Credit: Getty Images)

“Negative surprises”: Vornado execs talk retail struggles on Q2 earnings call

“Negative surprises”: Vornado execs talk retail struggles on Q2 earnings call
The Daily News Building at 220 East 42nd Street and SL Green CEO Marc Holliday (Credit: Getty Images)

SL Green puts Daily News building up for sale

SL Green puts Daily News building up for sale
220 Central Park South (Getty)

Duplex sells at Vornado’s 220 CPS for $65M

Duplex sells at Vornado’s 220 CPS for $65M
SL Green CEO Marc Holiday and 420 Lexington Avenue with Scabby the Rat (Getty; Google; Sl Green)

SL Green claims “saliva-spewing” picketers may be spreading Covid

SL Green claims “saliva-spewing” picketers may be spreading Covid
Citizens Bank CEO Bruce Van Saun and SL Green CEO Marc Holliday with 106 Spring Street (Getty; Sl Green; Google Maps)

One of Soho’s priciest retail spaces heads to foreclosure

One of Soho’s priciest retail spaces heads to foreclosure
From left: 410 Tenth Avenue, 745 Fifth Avenue, One Manhattan West and 522 Fifth Avenue (Google Maps, Wikimedia)

Real estate lending bounces back in September in a big way

Real estate lending bounces back in September in a big way
Brookfield's Ric Clark with 410 Tenth Avenue (Getty; Google Maps)

Brookfield weighs bid for SL Green’s Hudson Yards building

Brookfield weighs bid for SL Green’s Hudson Yards building
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...