Skip to content
Search AI Powered

Latest Stories

CBRE says commercial real estate lending slowed again in Q1

Commercial real estate firm points to stress in the banking system and financial market volatility

cbre Screen Shot 2023-05-15 at 5.39.22 PM.png

A slowdown in commercial real estate lending continued in the first quarter, due to stress in the banking system and financial market volatility, according to the latest research from CBRE.

The CBRE Lending Momentum Index, which tracks the pace of CBRE-originated commercial loan closings in the U.S., declined by 33% from the fourth quarter of 2022 and 53.5% when compared with the strong loan volume of a year earlier.


“The Federal Reserve’s commitment to reduce inflation with aggressive rate hikes continued to heighten market uncertainty through the first quarter. While plenty of debt capital remains available, increased borrowing costs coupled with credit tightening continues to put downward pressure on lending activity,” Rachel Vinson, President of Debt & Structured Finance, U.S. for Capital Markets at CBRE, said in a release. “Borrowers will continue to opt for shorter-term, fixed-rate debt with shortened call protection until volatility begins to normalize.” 

The report also traced trends in the four different sectors of lenders, including banks, life insurance companies, alternative lenders, and commercial mortgage backed securities (CMBS).

Despite some high-profile failures, banks had the largest share of CBRE’s non-agency loan closings for the fourth consecutive quarter at 41.1%—down from 58% in Q4 2022. This was driven by a diverse set of smaller local and regional banks, as well as credit unions. About one-third of bank loans were for construction projects, the majority of which were multifamily. The remainder was split between acquisition loans and refinancings.

Life companies were the second-most active lending group in Q1 2023 with 23% of closed non-agency loans—slightly above their Q4 2023 share. Loan closings in Q1 2023 included a high proportion of five-year deals, with an overall average loan-to-value ratio (LTV) of 52%.

Alternative lenders, such as debt funds and mortgage REITs, accounted for 20.2% of loan closings in Q1 2023, close to their Q4 2022 share. Higher spreads and interest rate cap costs created a challenging environment for financing floating-rate bridge loans. Collateralized loan obligation (CLO) issuance was limited to two deals totaling $1.1 billion in Q1 2023, compared with a total of $15.2 billion in Q1 2022.

CMBS conduit loans accounted for 15.7% of non-agency loan volume in Q1 2023—up from 2% in Q4 2022.  Industrywide CMBS origination volume was limited to $5.9 billion in Q1 2023, down from $29.1 billion in Q1 2022.
 

 

Recent

More Stories

containers and ships at port

AAFA urges ILA and USMX to resolve dockworker contract feud

As another potential strike looms at East and Gulf coast ports, nervous retailers are calling on dockworkers union the International Longshoremen's Association (ILA) to reach an agreement with port management group the United States Maritime Alliance (USMX) before their current labor contract expires on January 15.

The latest call for a quick solution came from the American Apparel & Footwear Association (AAFA), which cheered President-elect Donald Trump for his published comments yesterday indicating that he supports the 45,000 dockworkers’ opposition to increased automation for handling shipping containers.

Keep ReadingShow less

Featured

forklift moving pallet in a warehouse

Global forklift sales sputter as European economy struggles

Global forklift sales have slumped in 2024, falling short of initial forecasts as a result of the struggling economy in Europe and the slow release of project funding in the U.S., a report from market analyst firm Interact Analysis says.

In response, the London-based firm has reduced its shipment forecast for the year to rise just 0.3%, although it still predicts consistent growth of around 4-5% out to 2034.

Keep ReadingShow less
cover of report on electrical efficiency

ABI: Push to drop fossil fuels also needs better electric efficiency

Companies in every sector are converting assets from fossil fuel to electric power in their push to reach net-zero energy targets and to reduce costs along the way, but to truly accelerate those efforts, they also need to improve electric energy efficiency, according to a study from technology consulting firm ABI Research.

In fact, boosting that efficiency could contribute fully 25% of the emissions reductions needed to reach net zero. And the pursuit of that goal will drive aggregated global investments in energy efficiency technologies to grow from $106 Billion in 2024 to $153 Billion in 2030, ABI said today in a report titled “The Role of Energy Efficiency in Reaching Net Zero Targets for Enterprises and Industries.”

Keep ReadingShow less
AI image of a dinosaur in teacup

The new "Amazon Nova" AI tools can use basic prompts--like "a dinosaur sitting in a teacup"--to create outputs in text, images, or video.

Amazon to release new generation of AI models in 2025

Logistics and e-commerce giant Amazon says it will release a new collection of AI tools in 2025 that could “simplify the lives of shoppers, sellers, advertisers, enterprises, and everyone in between.”

Benefits for Amazon's customers--who include marketplace retailers and logistics services customers, as well as companies who use its Amazon Web Services (AWS) platform and the e-commerce shoppers who buy goods on the website--will include generative AI (Gen AI) solutions that offer real-world value, the company said.

Keep ReadingShow less
containers stacked at a port

Supply chain execs wary of three trends in 2025, Moody’s says

Three issues ranking at top of mind for supply chain executives in 2025 will be supply chain restrictions, reputational risk, and quantifying risk exposure, according to Moody’s, a global integrated risk assessment firm.

Each of those points could have a stark impact on business operations, the firm said. First, supply chain restrictions will continue to drive up costs, following examples like European tariffs on Chinese autos and the U.S. plan to prevent Chinese software and hardware from entering cars in America.

Keep ReadingShow less