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LIFE COMPANIES CONSERVATIVELY PLAY THE GAME
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The commercial real estate lending market picks up and life companies (LCs) Company Removed, Company Removed, Company Removed, Company Removed and Company Removed all plan to contribute. Some experts even predict LCs will be responsible for a bigger percentage of loans this year since other lenders are less active. But many see it as a market of have and have nots and virtually all the LCs are looking for the same high-quality transactions.
Expect LCs to put out around $35B this year and their investable cash flow is fairly stable and predictable, so as a result the amount to invest in commercial real estate is also stable. There is higher demand for lending in the commercial real estate world but there is also towering competition, especially for those Class A properties. Despite more life players becoming active in the game, don’t bank on deals with issues such as low occupancy to see any bids from LCs, especially since these companies usually stay away from Class B or C properties and instead look for higher yield debt funds. Some LCs are already more bullish in lending to retail properties lately because of the good credit tenants and NNN leases, especially in grocery-anchored centers. While others look toward apartments because of the stability of cash flow in the sector, diversity of tenants and apartments is expected to recover sooner, since it suffered stress earlier than the other sectors.
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Class A properties, Class B or C properties, commercial real estate, commercial real estate lending, grocery-anchored centers, lenders, life companies, retail properties |
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The Crittenden Report on Real Estate Financing
Is the inside source on who does what in real estate financing. Each week we bring you the news of what lenders are doing; analyze why they are doing it, and more importantly, what they will do in the coming weeks and months.
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