Fueling the Market: Lending Update

One of the key ingredients in today’s white-hot real estate market is the availability of attractive financing.

Interest rates are historically low and CMBS continues to play a dominant role across all retail product types. To dive a bit deeper into the implications we wanted to share a few real-world case studies.

The following case studies illustrate the implications of today’s lending market on transactions.

Case Study #1 
15-year NN WAG in FL
Lender: Morgan Stanley (CMBS)
Term: 10 Yr Interest Only
Rate: 4.17%
Cap Rate: 5.90%
Cash on Cash: 9.72%

Case Study #2 (Bridge Loan)
Colorado Add-Value Neighborhood Shopping Center
Lender: JCR Capital
Price: $10,000,000
Reposition Cost: $1,200,000
Leverage: 75% Loan to Cost
Term: 3-year bridge
2 years interest only
Rate: 5.625%

Case Study #3
Freestanding Home Depot – Bellingham, WA
On Market
Lender: CMBS
Price: $28,038,000
Cap Rate: 5.75%
Loan to Value: 65%
Term: 10 years
Amortization: Interest Only
Rate: 4.0%
Cash on Cash: 9.00%