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Mind the GAAP 

GAAP is widely used. It is required for public companies such as publicly traded real estate investment trusts, and often it is demanded of private real estate companies by institutional investor partners. But GAAP is not the only choice for

Private Mortgage Loans Provide a Short-Term Financing Alternative 

Private mortgage loans are made by private lenders instead of traditional financing sources such as banks, lending institutions, or government agencies. They usually are short term (6 months to 3 years) hard money or asset based loans, and the decision

Pre-Underwriting Helps to Sell Properties 

Residential homebuyers often get pre qualified to facilitate their negotiating and purchasing process. Commercial property brokers can use a less common but similar process for their income property listings — although it's the property that gets pre qualified, or pre

Redefining Debt 

Downsized operations and scarcity of tenants have temporarily left many business owners and developers with too much real estate and too much debt. Refinancing often is the solution of choice, but doing so isn&rsquo t always viable. Owners or developers

Rising Rates 

Recent commercial real estate capital market demand has caused capitalization rates to decline significantly, which has inflated real estate values despite poor fundamentals. Yet most experts believe that cap rates soon will climb. Investors should assess their properties to ensure

Sale-Leasebacks Provide Capital for Core Business Investment 

The market for sale leasebacks — transactions in which companies sell and then lease back real estate assets — is growing at an estimated $10 billion to $15 billion annually. Continued increases are expected due to today's difficult real estate

Exporting Capital 

As economies throughout the world continue to expand, the flood of real estate investment capital headed overseas has swelled to record levels. This unprecedented growth is expected to continue throughout the year and well into 2006. Despite a weak dollar,

Loan to Own 

Given the current credit market constraints, seller financing may be a way to bridge the financing gap facing buyers and sellers in today&rsquo s commercial real estate market. Seller financing is a transaction in which the seller makes a secured

Making It Work 

Investors soon may feel the effects of a cooling real estate market through subtle and not so subtle shifts in the way lenders view commercial real estate loans. The industry experienced strong surface growth last year National overall vacancy rates

Lenders Talk TICs 

Tenancy in common transactions involve a number of unique features. While currently there are no clear cut guidelines on how TIC deals must be structured, lenders that finance such projects are careful to impose certain requirements that usually are not

Low Rates Help Insulate Commercial Markets from Unstable Economy 

Last year, the commercial real estate debt market slowed considerably from the double digit growth the industry experienced the past three years. Overall, at the end of second quarter 2002, the debt market had grown 3.7 percent from the end

Loan Language 

Commercial real estate finance remains in a state of flux. Lenders are re entering the market with new policies and underwriting criteria. Many lenders have toughened the terms of their form loan documents. It is important for borrowers to understand

New Funding for Affordable Housing Encourages Public/Private Partnerships 

Affordable housing is a critical socioeconomic issue in many regions, and demand is rising nationwide. Yet financing and developing affordable housing can be challenging. Many affordable housing projects involve more planning and entail greater risks than similar market rate projects

Multifamily Property Owners Benefit From Competitive Financing 

The current low interest rates present a double edged sword for many property owners The rates offer increased cash flow opportunities, but they also allow tenants to qualify for higher loan amounts and motivate them to move out of apartments

Lenders Tighten Loan Standards in Reaction to Uncertain Economy 

With interest rates at record lows, demand for new mortgage loans remains strong. However, in today's anemic economic climate, lenders face increased risk of making non performing loans. Although it is impossible to eliminate this risk entirely, commercial real estate

Understand Lender Criteria to Finance Manufactured-Housing Communities 

Manufactured housing is a niche that offers potentially strong returns for some investors. Once thought of as simply mobile home parks, today's manufactured home communities are split into two primary categories landlease communities where residents own their homes and lease

IRA Investments 

Purchasing residential property using retirement funds has received a lot of press, but what's still new to many investors is the fact that commercial real estate also can be bought this way. In fact, the Internal Revenue Service allows individual

Debt Transfer 

While new money is difficult to find in the current economic climate, loan assumptions may provide the prospective debt commercial real estate buyers need to close deals. A loan assumption is exactly that A property buyer assumes a mortgage loan

Financing Fusion 

Many areas of the U.S. have an oversupply of office and industrial property, tight access to capital, and fewer and shrinking local businesses to sustain property absorption. During this turbulent period, the ownership leasing hybrid approach may provide an attractive,

Fast Funding 

Traditional financing is suitable for a multitude of commercial real estate transactions, which often allow several months of lead time to secure funds. But what happens when funding for a property transaction is required immediately or when borrowers are inexperienced?

Cover Your Assets 

Lenders holding commercial real estate secured loans want to ensure that, if a borrower goes bankrupt, the collateral property will not be consolidated with the borrower's other assets. To ease such fears, borrowers use "bankruptcy remote" single purpose entities, or

Experience Pays 

Experience counts, particularly for commercial real estate professionals involved in ground lease development. In addition, experience counts &mdash and can pay off profitably &mdash when choosing a ground lease lender. If a lender with the right experience is selected, under

Loan Liaison 

Appraisers and underwriters are involved in the commercial real estate financing process as objective sources to ensure that buyers and lenders do not let optimism for projects result in unfavorable transactions. However, sometimes these professionals base their assessments on data

FHA Facts 

In today’s tight credit market, multifamily owners and developers are challenged with finding financing that works now as well as in the uncertain future. In such turbulent times, the Federal Housing Administration loan programs serve as good, reliable sources of

Wait and See 

Last year, the commercial real estate debt market again decreased considerably from the last decade's double digit growth rates. This slower growth indicates a lower level of transactional activity —buying, selling, and refinancing — taking place as the industry awaits