One of NYC’s top multifamily lenders says 13% of portfolio is in deferral

New York Community Bank said collections in rent-regulated apartments were strong

TRD New York /
Apr.April 29, 2020 03:10 PM
New York Community Bank CEO and president Joseph Ficalora (Credit: Facebook)

New York Community Bank CEO and president Joseph Ficalora (Credit: Facebook)

UPDATED, May 7, 2020, 10:05 a.m.: New York Community Bank announced that 12.6 percent of its $38.8 billion loan portfolio is currently in deferral, but residential rent collections were better than expected.

More specifically, 25 percent of the bank’s $7 billion commercial real estate portfolio and 9.6 percent of its $31.3 billion multifamily portfolio are in deferral.

The bank reported net income of $92.1 million for common shareholders in the first quarter, up 3 percent year over year and down 1 percent from the fourth quarter of 2019. Its president, Joseph Ficalora, assured its investors on a Wednesday earnings call that its multifamily borrowers have not been hit as hard as others.

“Based on our market intelligence, April rent collections on rent-regulated buildings in our portfolio are estimated to be 80 to 85 percent [of normal levels],” Ficalora said. “On market rent properties it is even higher.”

Rent-regulated apartments represent $18.7 billion, or 60 percent, of the bank’s total multifamily portfolio.

Overall, the bank is optimistic about its position in the market and predicted that due to the coronavirus crisis, it will be able to increase its market share relative to other multifamily lenders.

“When the market is stressed, we get a greater share of the market,” said Ficalora. “We do believe in the environment ahead, many of the lenders in our niche will lend less and we will lend more.”

New York Community Bank was one of the first banks to offer a forbearance program for its borrowers. Those whose cash flows are impacted by the health crisis were given two options: six months of interest-only and escrow payments, or deferral of principal and interest for six months, payable at maturity.

The rate of deferrals varies across asset types. Just 6 percent of residential buildings with more than 100 units are in deferral. But smaller and mixed-use buildings with retail components are experiencing much higher rates of deferral, according to the bank’s officials.

For now, larger multifamily buildings are a relative safe haven in the bank’s portfolio. But that may change if planned rent strikes are carried out in May. New York tenant groups announced their intent to withhold rent en masse earlier in April, and have since received support from numerous politicians.

UPDATE: This story has been corrected to clarify that 25 percent of NYCB’s commercial real estate portfolio is in deferral.


Related Articles

arrow_forward_ios
Clockwise from top left: 162 West 13th Street, 325 Avenue Y in Brooklyn, 1281 Viele Avenue in the Bronx (Credit: Google Maps)

Here’s what the $10M-$30M NYC investment sales market looked like last week

Here’s what the $10M-$30M NYC investment sales market looked like last week
Real Capital Analytics data showed that New York’s multifamily market had a very slow July. (Credit: iStock)

New NYC rent law “beginning to shut down investment”

New NYC rent law “beginning to shut down investment”
Numbers were down across the board (Credit: iStock)

New York’s multifamily market had its slowest first half of the year since 2011

New York’s multifamily market had its slowest first half of the year since 2011
San Francisco Supervisor Dean Preston and San Francisco Apartment Association Executive Director Janan New

Real estate groups challenge San Fran’s permanent ban on coronavirus-related evictions

Real estate groups challenge San Fran’s permanent ban on coronavirus-related evictions
Malls are hemorrhaging retailers left and right. What will happen with all that space? Some could be converted into apartments and condominiums. (iStock)

Retail-to-residential conversions are in cards at America’s doomed malls

Retail-to-residential conversions are in cards at America’s doomed malls
Photo illustration of Gov. Andrew Cuomo, Judge C. Stephen Hackeling and Chief Justice Lawerence Marks (Getty, iStock)

Judge rules evictions guidance unconstitutional, moratorium invalid

Judge rules evictions guidance unconstitutional, moratorium invalid
Related chairman Stephen Ross and Related Companies Portfolio CEO Richard O’Toole withBronx Terminal Market and Time Warner Center (Getty, Google Maps, Wikipedia)

Related lays out $200M debt settlement plan for Tel Aviv bondholders

Related lays out $200M debt settlement plan for Tel Aviv bondholders
Inside a $1.8B new development odyssey

Inside a $1.8B new development odyssey

Inside a $1.8B new development odyssey
arrow_forward_ios

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

Loading...