Category Archives: News

Opportunity in the Apartment Market for Family Offices

I like Antonio’s article and hope that more family offices invest in multifamily assets. We’ve always enjoyed finding commercial real estate financing for family offices, but the challenge has been the locations. Antonio suggests that they should look in secondary and tertiary markets but what we’ve found is that the family offices tend to start off investing in locations near their home base with a GP partner before heading into a smaller market which makes it more difficult. We’d love to see more commercial real estate news saying that family offices are pouring into the space but only time will tell if they want to pick up multifamily assets and commercial building loans in markets they don’t know well.
– Adam Horowitz, Principal of Lever Capital Partners and President of the Real Estate Capital Alliance

Click here to read Antonio’s article on why family offices shouldn’t overlook the apartment market.

Reinvention of the Ground Lease Business

We see a lot of ground leases when looking at deals in larger markets like New York City and San Francisco, but less so when looking at commercial real estate loans in Las Vegas or St Louis. I think Jay has hit upon a smart market strategy as there aren’t a lot of national players going after this business. It makes attaining commercial real estate loans a bit more challenging due to the ground lease, but good lawyers usually solve any issues surrounding it as long as the lease is fairly long-term. We’ve had a few deals where the commercial real estate mortgage interest rates ticked up a bit for these types of assets where we’re only financing the building but the deals have all closed.

– Adam Horowitz, Principal of Lever Capital Partners and President of the Real Estate Capital Alliance

Click here to read more about Sugarman’s thoughts on the reinvention of the ground lease business.

New Approach to Senior Living: Multigenerational Communities

This was an interesting article to read, and I think personally a good idea. The challenge with this idea on senior housing will come from the commercial real estate lending side. The commercial real estate financing business moves pretty slow and they like to see that there are many very similar projects that they can draw from for comps and previous success. We’ve worked on similar projects recently and have seen that attaining a commercial real estate mortgage was more challenging in this sector, although still doable.

– Adam Horowitz, Principal of Lever Capital Partners and President of the Real Estate Capital Alliance

Click here to read more about senior living bridging the generation gap.

Student Housing Trends in 2018

As I speak with some of our Student Housing clients we’re seeing many of the changes that Elliot mentions, particularly in the way they market to perspective tenants. In terms of getting a commercial real estate mortgage from the agencies, that’s still the goal for most borrowers unless there’s a heavy lift on the rehab site in which case different types of capital are needed. As commercial real estate mortgage interest rates rise I think we’ll see some of the weaker borrowers in this space have a harder time making deals pencil out and bigger players like Vesper taking down these assets. The more things change the more they stay the same and Cash is still King isn’t really commercial real estate news to anyone in the know.

– Adam Horowitz, Principal of Lever Capital Partners and President of the Real Estate Capital Alliance

Click here to read more about Student Housing Trends in 2018

The End of Office Space as We Know It

Our team at Lever Capital Partners has been providing commercial real estate financing for a few clients in the co-working space. As the average interest rate for commercial real estate loans keeps creeping up, our office owners are looking for additional ways to boost their NOI. Over the last couple of years we’ve been hired by firms that are trying to emulate WeWork in markets where they already have a strong office presence. The ability to get a commercial building loan is getting easier as WeWork co-working expands into smaller markets.

– Adam Horowitz, Principal of Lever Capital Partners and President of the Real Estate Capital Alliance

Click here to read more about The Rise Of ‘Office As A Service’.

Smaller Metros in the West are Emerging

Our team at Lever Capital Partners has noticed similar trends as we started seeing more smaller metro deals come across our desk the last few years. It’s still hard convincing non bank commercial real estate lenders to do business in many of these markets, despite showing the data that supports commercial real estate financing in those areas. The more cre news similar to this article the better support we’ll have in the future when working on deals in this sector.

– Adam Horowitz, Principal of Lever Capital Partners and President of the Real Estate Capital Alliance

Click here to read more about the emergence of smaller and Western metros.

Shift Towards Zero Parking in the Multifamily Sector

Parking requirements are changing but not as fast as many of us would like. Speaking of things moving slowly, the commercial real estate financing world moves even slower which means nobody has to do anything today. Moving towards zero parking will be more relevant in cities like San Francisco and other major markets. If for example you’re looking for commercial real estate loans in Las Vegas for a multifamily project this will be less of an issue. When it comes to the lending side, I think that non bank commercial real estate lenders will change their parameters more quickly than traditional banks.

-Adam Horowitz, Principal of Lever Capital Partners and President of the Real Estate Capital Alliance

Click here to read more about changing parking requirements for multifamily properties.

Socially Responsible Investing in the Multifamily Sector

I love the positive aspects of this article as they pertain to both my business and personal interests. That fact that “Society is demanding that companies, both public and private, serve a social purpose,” is music to my ears. When it comes to commercial real estate lending, we are very selective about who we do business with. The commercial real estate financing world has it’s share of bad characters and we learned a long time ago that life is too short to work with such people. We look for clients that are providing something of value to the community whether it be commercial or multifamily residential development. I look forward to this trend continuing and reading more commercial real estate news with similar stories.

– Adam Horowitz, Principal of Lever Capital Partners and President of the Real Estate Capital Alliance

Click here to read more about socially responsible investing in the multifamily space.

Higher Cap Rates and More Listings in the Net Lease Retail Market

We finance a lot of NNN deals and are also seeing our clients move towards what they call in the article “e-commerce-resistant and experiential tenants”. Contrary to the piece, I haven’t noticed the 10 basis point increase in the retail cap rates, but I also don’t run a large public REIT. We’re more concerned with the average interest rate for commercial real estate loan products. Things here have remained relatively steady and there are a few non bank commercial real estate lenders that have been financing our development projects at 100% of cost plus pursuit costs. I think the biggest topics in CRE news are the tax changes which could impact owners and their desire to look at sale-leasebacks as an alternative to holding onto the assets. We’ll be ramping up our efforts on that front towards the second half of this year.

-Adam Horowitz, Principal of Lever Capital Partners and President of the Real Estate Capital Alliance

Click here to read more about changes in the net lease retail market.

Hotel Loan Performance: Threats of Competition and Overbuilding

Performance might take a slight hit, especially in places like New York where it looks like there’s a new hotel on every block as I walk around different neighborhoods, but I don’t think it’ll make much of an impact. The saving grace is that commercial real estate loans for hotel construction have been tightening up for the last 18 months and therefore only hotels in locations with a clear need and strong sponsorship are on the drawing board for future development. I think the commercial real estate news stories moving forward will be more about commercial real estate refinance stories rather than new builds.

– Adam Horowitz, Principal of Lever Capital Partners and President of the Real Estate Capital Alliance

Click here to read about how competition and overbuilding could threaten hotel loan performance.