Commercial Real Estate Lending Industry Grinding to a Halt, Says Private Commercial Lender Hamed Elbarki
(PRWEB) April 15, 2008 -? Turbulent credit markets in the U.S. have all but frozen traditional commercial lenders and investors, rendering it nearly impossible for companies and consumers to get a conventional real estate loan, according to Elbarki.
As reported by the Dallas Morning Star in January, the cost and underwriting standards for commercial loans have significantly increased due to a credit crunch caused by the collapse of subprime residential lending (The Dallas Morning Star, January 2008).
?This means that borrowers are having great trouble financing their projects through conventional money sources,? said Elbarki, CEO of Aventura Trust Investments (ATI). ?Most lenders are predicting a grim forecast and are tightening their belts on lending standards to compensate.?
Late last year the Federal Reserve Board released their latest Senior Loan Officer Opinion Survey on Bank Lending Practices, which indicated a dramatic shift in the supply and demand of commercial and industrial loans as well as changes in bank credit standards (The Federal Reserve Board, October 2007).
Elbarki notes that companies are the ones to be hardest hit by across-the-board bank restrictions. Financial news leader Bloomberg.com reported in February that about 80 percent of banks raised standards on commercial property loans in the previous three months. (Bloomberg.com, February 2008).
But, Elbarki warns, there is a significant difference between private lenders like ATI, who source their funds from high net worth individuals, and private lenders who are, in actual fact, owned by banks and often reliant upon securitization for liquidity.
Private commercial finance company Bayview Lending Group is one such example of a lender under pressure to make cutbacks. Without the ability to offer as many loans as a result of the decrease in demand for mortgage backed securities, the Coral Gables-owned company announced this month that it would eliminate hundreds of jobs around the country.
?These changes?are expected to result in a significant reduction in loan volume and necessitate a commensurate reduction in staffing, including elimination of several regional processing centers,? Bayview spokeswoman Ellen Charleton told the Miami Herald (Miami Herald, April 2008).
About Hamed Elbarki:
Hamed Elbarki is the CEO of Aventura Trust Investments (ATI). ATI handles the needs of commercial real estate borrowers nationwide as well as offering commercial loans to international clients.
For more information please visit: http://www.AventuraFinance.com/
Contact:
Grant Hemingway
Aventura Trust Investments
305-466-3767
###
Related Articles:
NetGain Brings Web 2.0 to Commercial Real Estate Investing
NetGainRealEstate.com has added a host of interactive social tools to its top-rated site creating an international income property community.
MyNextDeal Launches Job Site for Commercial Real Estate Professionals
Commercial real estate listings company MyNextDeal launches MyNextDeal Jobs.
MyNextDeal and Catylist, Inc. Form Partnership to Extend Reach of Commercial Real Estate Listings Online
The listing exposure options expand for Catylist members as the company partners with commercial real estate listing service MyNextDeal.
Stop the Bitchin': Positive Outlook for Commercial Real Estate Investors
In its most recent podcast "Stop the Bitchin'," the firm encourages real estate borrowers to stop longing for the halcyon days of 2007 and the era of free money. Instead, the time has come to explore opportunities that will enable them to execute new projects with accessible and affordable financing.
Commercial Real Estate Desirability
For those who are looking for an excellent way to generate outside income, the commercial real estate industry is a great way to go. Many people have begun to invest in commercial real estate, and since this type of real estate is continually being purchased and sold, it has become an excellent way to invest money for a guaranteed return. Before one becomes involved in the commercial real estate market, it is highly important that they understand the commercial real estate industry and its many surrounding components.
An Overview of Commercial Real Estate Financing
A number of bigger financial institutions use commercial finance to make money. Even given the relatively poor home market, this remains a quality investment. Commercial real estate loans may not have slightly lower returns, but the investment is more solid. That is particularly important for businesses sitting on more liquid assets than they are comfortable with.
NetGain Follows Web 2.0 to Dramatic Gains in Internet Reach for Commercial Real Estate Investing
NetGainRealEstate.com sees 60 percent growth in worldwide cities accessing Web site.
Local Commercial Real Estate Brokers Use Technology To Build Their Business
We provide a full range of commercial real estate services for our local, national, and international clients. Whether you need to buy, sell, lease or manage property, our expertise and hard working team will bring you the desired results you deserve. Since 1987, we have assisted our clients with Land, Industrial, Office, and Investment transactions.
Commercial Real Estate: Becoming A Market Expert - Part #6: Focus On The Area Of The City With The Zoning You Need
By now, you?re probably pretty well acquainted with the process on of focusing on the property type and area you want. You know the zoning which supports it and you?ve reviewed in detail the zoning maps.
Commercial Real Estate: Assessing The Unique Features Of Commercial Real Estate Parcels
As commercial real estate development progresses into the 21st century, many of the principles upon which the market was founded remain the same. Whether you are a property owner, developer, or commercial real estate agent, identifying and marketing the unique features of your commercial property will maximize the attractiveness of the site to prospective buyers or tenants.
The Truth About Commercial Real Estate
Many people confuse commercial real estate with residential real estate What is the difference between the two
Why You Need To Start Investing In Commercial Real Estate TODAY...
Is The Pot At The End Of Your Rainbow Filled With Fool's Gold? Why You Need To Start Investing In Commercial Real Estate TODAY... BY: J. Scott Scheel
Commercial Real Estate Listing Service MyNextDeal Announces Partnership with CIMLS
The listing exposure options expand for CIMLS members as the company partners with commercial real estate listing service MyNextDeal.
Savannah, Georgia Commercial Real Estate Information – Property Listings, Market Research and More
A new website designed to bring you the most comprehensive source for Savannah Georgia Commercial Real Estate Information including Property Listings, Market Research and Local News.
Slow Roll on Miami Commercial Real Estate
Nationally every real estate market is in the red, it is a very common cause of the nationwide crisis that hits the country coming this year. People can just witness as the numbers goes down in the drain in a fast rate. It took a few years to recover from the drought when the last time the nation hit a housing drought and experts indicates that itll be a lot longer this time base on their calculations. For Miami most of their markets are also dipping into the water, it cant be helped as is has factored on many causes that evidently slide down to its currents state now. I think when you point on the markets stature right now youll see how bad it is and it sort of hits you. Miami Commercial Real Estate market is actually affected by the dr...