Commercial Lending
The Business & Investor Side of Our Work
Good Morning to Springtime and Welcomed Rain!
As the political landscape shifts, so too, federal policy and local market conditions. Regardless, our primary focus remains the same: helping you succeed in commercial real estate investing.
While politics grab the headlines, our focus is on the hard data. The economic fundamentals, financing strategies, and most important: Opportunities that matter to investors like you.
Your Lending Success Is Our Priority:
One of our strengths is our lending partnerships. We working closely with professionals who understand today’s market. Our network includes top-tier commercial lenders actively funding deals. We even bring awareness to lenders not yet ready of today’s market.
Good New: Whether buying, selling, refinancing, or even executing a 1031 Tax Exchange, we have the expertise and critical relationships needed to secure financing right for you.
Spotlight:
Retail Shopping Centers & Investors
We specialize in Retail Shopping Centers and Residential Investor Financing. Why? Because to succeed in today’s lending environment you need: 1) deep industry knowledge and 2) a detail-oriented approach to succeed. Call us. Its the important first step.
Why retail shopping centers?
1️⃣ Leases Matter – Every lease is unique in terms and structure. And when it comes to financing, they directly impact loan terms. It is here, we help navigate this complexity.
2️⃣ Market Stability – Existing shopping centers offer steady occupancy and income streams. This is reinforced by limited new construction. A means for small businesses challenged by online shopping.
NOTE: While a key focus, we successfully structure loans for apartments, hospitality, storage, office, industrial, agricultural, and development projects, as well. Call us. We are well versed.
The Good News: We help can turn a loan rejection into an Approval. We have highly qualified lenders and expertise ready to listen, act, and close your deal. Start today. Call now.
Who are our primary lenders? Overall, our market participants remain fairly stable and consistent, as to market share. Of importance are the exceptions and changes in the market – Banks and CMBS. In 2024, Bank’s share of the lending market, dropped to 28%, from a previous 40 %. CMBS increased to 22 %, from about 11 %. Key: We have on-going, good working relations with all of them.
Economic Realities: What’s Happening Now?
1) Federal Reserve & Interest Rates: Our favorite “tea leaves” is the 10-year Treasury. It has been trading in the 4 – 4.5 % range, since late January. As for the Federal Reserve, their working policy holds steady. No immediate changes are seen, BUT keep watching.
2) Key Economic Data:
Most recent CPI and PPI readings were quite friendly. They continue the downward trend we expected. The Housing component continues to come in lower, balancing out last year’s hotter numbers. NOTE: If Housing were counted real time – not a compilation number over the last 12 months – overall CPI would be about 1.95 %. Good News: Right in line with Fed’s current inflation target. Expectation: Lower CPI and PPI, over the next couple of months.
3) Jobs Market: Numbers Matter
We continue to be good, based on last week’s initial claims, matching the average measured over the last 4 weeks. Steady and stabile is good.
While talk of a softening, based on indicators – easing of pay raises, as one data-point – there is no notable shift in labor markets. Headlines preach the negative, yet all is actually tracking inline with numbers of 6 months ago. Advantage – no significant slashing of the workforce.
4) Architectural Billings: Supply & Demand Shifts
A good “leading indicator” of commercial construction activity, in the intermediate term. Until 2020, all sectors of billing were in “mild” expansion mode. 2021 and most of 2022, this rebounded aggressively. Since then, the general trajectory has been downward, with all sectors crossing into contraction – below the 50 line in the 4th Quarter 2023. Remember, this number is for comparison purpose – present vs trend lines of past activity. A good gauge to keep close.
5) Cap Rates: A topic of consistent conversation. Recent polling: Cap rates are holding. Nation-wide: Office at 8, shopping center and medical office at 7, industrial at 6.5, apartments at 5.7, and self-storage at 4.8 Further, the spread to the 10-Year Treasury is below normal as the 10 Yr T continues to trade above the 10 year average. The result: Investors are staying safe in Treasuries. This means lower rates. Advantage – Investors.
Smart investing means identifying resilient markets
with strong long-term fundamentals.
Be Ready Before the Market Moves
In summary: Start preparing the paper work today, for a brighter tomorrow. This gives you the definite advantage as to timing and location: Call us. We’re ready to help today.
Perspective: In times of change, comes uncertainty and need for insightful wisdom. In the mid 90’s, while most of the USA was doing well. Such was not true if you were tied to the military, especially military bases. This was a period of a great reset from past policy. For localized real estate, it became a tale of 2 stories. Here in the Bay Area, it was a shellacking – base closures and industrial shutdowns. It resulted in a serious recession. Strong enough to generate noticeable drops in home prices. Remember FMC on Coleman Ave?
In response, late 90’s became a fabulous time to investment, but few did. Most sat on the sidelines, not believing this would ever pass. The great dot.com meltdown, had a similar response and reaction. The Unemployment rate was increasing at the fastest time in history, turning towards a deep recession. It officially turned around with 9/11, but not for the Bay Area.
Common thread: Early in turn-around periods become a great buying opportunity. And the story goes on. Will it be different this time? Each investor gets to decide, yes or no. I am in the YES camp, but love talking with those moving forward and those choosing to wait. It is what makes the market. Both are correct. We want to be a part of both conversations. Let’s talk.
Know How to Win: Discipline, Preparation, Patience.
A professional team – Proven, Trusted, and Successful.
Successes Continue: Let’s discuss your next move. A recent referral: A small mixed-use building owner received a call from their bank – Note DUE. Not a call expected. Suffice it to say, it was unpleasant for the borrowers. Many challenges, though loan docs drawn, and signed. Trouble: No funding for over 2 months. About as weird as it comes. We were then contacted and within a couple of weeks, secured a new loan and lender. Pressure off. Now they were refreshed and ready to move forward. Lending is needed and necessary, But it can be tough and have difficult moments. It is why we are here and why a caring professional can be a good friend. We find the best path and we walk it with you.
Tax-Deferred Exchanges (1031s) Are Booming
If you’re considering a 1031 Exchange, let’s talk before you sell to ensure you maximize the tax benefits, keep your cash working for you, and reinvested smartly.
Loans Coming Due? Act Now.
Loan extensions aren’t guaranteed or as straightforward. like they once were. If you have an upcoming maturity, don’t wait – start the financing process early. Even today!
Creative Solutions for Complex Properties
Have a unique investment property or a deal that doesn’t fit the traditional lending box? We specialize in structuring solutions to get financing done when others can’t.
Let’s Talk Today
Good financing requires great relationships. Our lending partners trust our process and attention to detail. This means better execution and smoother closings for you.
If you or someone you know is looking for expert lending guidance, we’re here to help. Now is the time to start preparing for tomorrow’s success.
Let’s connect today. Early Preparation is Key
