Commercial Real Estate Finance

Posts Tagged ‘green building’

Protesting bank-financed mountaintop removal

“It’s one thing if your potential borrower is dumping cyanide in a river.  But if they’re dumping carbon dioxide into the air, which is not exactly illegal — what do you do?”

For a lender, this is an obvious ethical dilemma.  I think most lenders would agree that they wouldn’t want to finance a business that is doing something illegal (i.e. dumping cyanide in a river).  But there are plenty of lenders who finance profitable businesses that are 100% legal, albeit in some sort of moral “gray area” (i.e. dumping carbon dioxide into the air).  According to this article published on Monday by the New York Times (NYSE: NYT) from where I got the above quote, banks are starting to move away from making loans in that gray area.

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Over the last six months, I’ve seen numerous marketing packets (mostly from law firms) advertising professional expertise to help owners/developers of real estate to get financing through ARRA bonds.  Curiously, in spite of all this marketing, I have yet to hear of a private development project in my local market that successfully secured ARRA bond financing.  I think the reason for this is that no matter how savvy you are when it comes to low-cost government subsidized financing, there is simply too much luck involved in issuing ARRA bonds.  And as far as I remember, none of the law firms whose marketing packages I’ve seen had “Luck” as an area of expertise.

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Week of April 11-17

- As more deals come to market, market observers are getting hopeful the commercial mortgage-backed securities market is beginning to revive.

- Cafaro: It’s possible to make money with low leverage.

- Based on guidance reports and other public statements, public REITs are planning to break ground on $1 billion in new development this year.

- Hedge fund manager James Chanos is concerned the rapid price buildup in China’s property market might burst as soon as this year.

- The Fed fears inflation and price deceleration going forward.
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The Week of July 4-10

-Apparently CBRE does want you to think about the environment before printing those emails.  They have submitted 225 buildings for LEED certification.

- Deutsche Bank is selling 825 Eight Avenue after all.

- A bankrupt lender has accepted funding that will pull them from the icy grip of Chapter 11.

- A mixed use property in London has fetched a 122 million Euro price tag.  What’s the conversion rate again? Read the rest of this entry »

Andrew Eisenstein
Founder & Managing Director
Iron Stone Real Estate

Iron Stone is a group of investment companies with a niche focus on distressed real estate and related assets in the Philadelphia region. Since the mid-1990s, Mr. Eisenstein has completed over $250 million in real estate projects in the Philadelphia metropolitan area.  He takes pride in creating value not only for his investors but also for the communities he works in, by revitalizing distressed and undervalued buildings.

Q: How has your strategy changed as a result of the credit crisis? Have you expanded/narrowed your acquisition criteria? If so, to what, and why?

A: Recently, we are buying first mortgage liens on real estate from banks. We are filling a void for lenders as there are not a lot of buyers for mortgage notes where the underlying collateral needs help. Buying notes was going to be part of our ongoing business with buying development real estate as the other part. As there is no credit for buying real estate, we are focused on buying notes. Read the rest of this entry »

Here at the Llenrock Group, we are huge advocates of environmental sustainability. Our printers never have paper in them because we try to save trees. The punishment in our office for throwing recyclable items into the regular trash bin is a public flogging with a bamboo rod.  Sometimes I wonder if our founder should have just set up the Llenrock office in Singapore.

In the spirit of our tree-hugging mentality at Llenrock, we have compiled a list of “The 10 Greenest Buildings” in the world. Obviously, there’s no way to determine what “the greenest” building in the world is, but we thought each of these projects was pretty cool for their environmental sustainability.

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