Commercial Real Estate Finance

Posts Tagged ‘FDIC’

Commercial Real Estate Week In Review for the Week of August 14-20

- Will the Federal Reserve, FDIC, SEC and Commodity Futures Trading Commission really be transparent in the Dodd-Frank Act?

- How much of an impact is the current housing market complicating things for Fannie Mae and Freddie Mac?

- Bank of America is considering paring its stake in  BlackRock Inc., citing its not a core asset.

- The potential shake-up in ownership of bookseller giant Barnes & Noble has shopping center landlords nervous.

- Delinquent construction loans have reached a record level in the U.S.
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Commercial Real Estate Week In Review for the Week of August 7-13

- Bank of America is seeing very few requests from investors and insurers to repurchase sour loans.

- Could teaming up with REITs be a way for pension funds to boost their returns?

- Industrial Income REIT has been busy, buying 16 assets for $43.5 M.

- How does the Volcker rule change the game for private equity investments?

- Grant Thornton is predicting there will not be a recovery in commercial real estate until 2011.
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Commercial Real Estate Week In Review for the Week of July 31-August 6

- Could CMBS loan defaults really reach 15% by year’s end?

- REIT ETF’s might be volatile, but they are still performing well.

- According to IMF, commercial real estate is still a big threat to the economy.

- Screw inflation fears….are we headed for deflation?  Some fund managers think so.

- The once vibrant industrial market of Exit 7A in NJ now has a 48% vacancy rate.
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While many people are questioning the Federal Deposit Insurance Corporation’s (FDIC) strategy for managing assets seized from failed banks, we must look to the 1980’s Savings and Loan Crisis to see the reasoning behind their “risky business”.  In 1989 the Resolution Trust Corporation (RTC) was an asset management company established by the Financial Institutions Reform Recovery and Enforcement Act (FIRREA), and charged with the liquidation of insolvent assets belonging to failed banks.  These assets were primarily real estate-related assets, and between 1989 and 1995 the RTC closed or resolved 747 thrifts with total assets of $394 billion. Read the rest of this entry »

A couple of days ago the top trending topic on Twitter was “#4wordsbeforedeath” meaning if you had 4 words to say before you died, what would they be? (for those of you who don’t follow us on Twitter, find us @llenrockgroup) Llenrock’s 4 words were “buy low, sell high.” Someone who truly lives by this common phrase is Barry Sternlicht, the “King of Hotels.” Mr. Sternlicht capitalized on the back end of the Savings and Loan Crisis by amassing capital and purchasing properties the government was auctioning off. It is also said that the real estate market is cyclical, and Mr. Sternlicht is counting on this principle as he has, once again, begun to buy up real estate. Read the rest of this entry »

While attending RealShare Philadelphia 2010 recently, Dr. Peter Linneman, a renowned economist and UPenn professor spoke about the economy and its impact on real estate.  He made a very interesting observation regarding the stagnation in the economy, and subsequently, its strain on commercial real estate.

“How many of you watched the Super Bowl?” he asked. “What if when the Saints scored a touchdown, the refs decided to put up 6 points for the Colts?  What if when the Colts kicked a field goal, the refs decided not to award them any points?  What if the refs started making tackles and intercepting passes?  Would you bet on that kind of game?”  Rhetorically, he followed, “No, you would probably turn the game off after 10 minutes.  Why?  Because as entertaining as it may be, its a stupid game and impossible to predict the outcome.”

“Regulators enforce the rules of the game to be played, much like referees in sports. Right now”, Linneman says, “the Fed, FDIC, and Federal Government, all of whom are supposed to be regulators, and thus referees, are acting as players too.” Read the rest of this entry »

The Week of March 6-12

- Senator Dodd proposed that the Fed continue its oversight of the largest banks.

- The FDIC loan auction could mean trouble for still-healthy banks.

- Dubai World is seeking to restructure $26 billion worth of debt….good luck with that.

- Should the Fed be gradually decreasing its balance sheet? The EVP of the Fed Reserve Bank of New York thinks so.

- Creditors have offered nearly $4 billion in commitments to GGP.
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A couple of months after I quit my job at JPM to join Llenrock, I had dinner with my former trading colleagues.  True to form, all we really talked about was trading.  And that, of course, led to talk about specific trades.  It’s the trading analogue to fishing stories about ‘the one that got away’.

In my book, at the time of my departure, was a losing trade.  i.e. I had already lost money on a trade, but had not yet cut my losses in the belief that the market would move my way.  In response to some teasing about the ‘bad trade’ I pointed out that, in fact, the traded ended up moving my way after I left.  I was basically saying, “Hey, I’m not such a dummy after-all.  While I lost money initially, the trade turned and ended up actually making money.”

The response to me: “It’s a mark to market business.” Read the rest of this entry »

For the Week of February 6-12

- Will small U.S. banks have to start curtailing lending?

- Fannie and Freddie are set to purchase $200 billion in delinquent home loans.

- Multifamily REIT CEOs expect improvement in fundamentals in 2010 and a generally positive year.

- Mall landlords are expecting a much better 2010 according to WSJ online.

- An aquarium development deal in Times Square?
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While many you have not even gotten to the ‘aftermath’ portion of the credit crisis, the federal government is busy not learning lessons with the benefit of hindsight.  Obama’s plan to funnel $30 billion to “small banks” is exactly the sort of central economic planning that effectively caused the crisis. Read the rest of this entry »