May 27, 2009
RGE Monitor has an article out on the State of Real Estate Around the World. It’s a bit of a long read, but highlights are below on the commercial side of things in the USA:
Commercial vacancy rates are on the rise in almost all major centers in Europe and North America and net effective rates have declined by 25-30% in major cities in Asia, suggesting that new investment is unlikely as these cities try to absorb overcapacity in retail and hotel trade.
On May 19, the Federal Reserve announced that “starting July, certain high-quality commercial mortgage-backed securities issued before January 1, 2009 (legacy CMBS) will become eligible collateral under the Term Asset-Backed Securities Loan Facility (TALF).” Moreover, the maturity of TALF loans backed by legacy CMBS was extended to 5 years. While TALF is a non-recourse lending facility originally created to reignite the consumer and small business loan securitization market, the effective drying up of the CMBS re-financing market puts $160 billion of CMBS maturing this year out of the $700 billion at risk in 2009 alone.
For a full read, the article can be viewed here.
- Government Expands Financial Stability Act to Include CMBS
- TALF Extended Into 2010
- Commercial Real Estate Lending Remains Tight
- Prudential CRE US Quarterly Update
- Commercial Maturities Update from First American CoreLogic