Tuesday, June 2, 2009

CRE Miniperm Underwriting Today and Yesterday

Deal Junkie suggests in this post that although the CMBS market is frozen, balance sheet lenders continue to lend on CRE. Traffic Court counters here that, although balance sheet lenders are making loans, the underwriting is much more conservative.

I took the current loan terms and underwriting parameters from one of the banks mentioned in the Deal Junkie post and compared them to the terms and underwriting on an actual deal done in 2006. The loan is a 5 year term with the first 3 years fixed. The bottom line, 17% fewer loan dollars. Here are the numbers: