CCIM Feature

CCIM Connections

Financing’s Future

Since Richard L. Podos, CEO and president of Lance Capital in New York, appeared on the Commercial Financing panel at the CCIM Live! conference last October, the presidential election and fiscal cliff have come and gone. Have the intervening months tempered Podos’ unflinchingly realistic outlook for the lending environment? Not much.

“Commercial lending in general has been slowly getting better,” he explains. But, “The real problem, in my mind, begins with leasing. The standoff between the right and left and the current administration’s new regulations have the business community unsettled.” And, in turn, lenders are concerned about occupancy, particularly in smaller markets, which could take three to four years to come back, he says.

“We hear in the media about the mortgage maturities coming in 2015,” Podos says. “But at the same time, we’re going to see 50 percent of [mostly office and industrial] leases expiring. How can lenders be certain these tenants will renew, or not reduce their footprint or reconfigure space, which requires a large tenant improvement contribution?”

Lance Capital specializes in credit tenant lease financing, which provides financing for TI based on tenants’ credit. So it, too, may be affected by the prevailing uncertainty.

“It’s going to be a very challenging time for all of us,” he says. However, “For CCIMs — who understand leasing, lending, and investment — it’s a great opportunity,” Podos adds. “By virtue of their training, CCIMs are the best candidates to address those multiple silos.”