Archive for the ‘Property’ Category
Commercial Mortgage Backed Securities “CMBS”, which was plummeted as a toxic financial asset, is taking a small step back into the market and this time with some relevancy and support. Borrowers with smaller properties and in areas outside the biggest cities are benefitting from the increase in demand for the securities increases from investors seeking higher yields.
The rebound in commercial-mortgage backed securities is making refinancing easier for property owners that have been passed over by institutions that usually hold real estate debt on their books, aiding a recovery in commercial property values. Randy Waesche, an investor in several New Orleans-area hotels, was running out of time to retire debt he took on to build a Marriott hotel in downtown New Orleans when Citigroup offered him a workable solution.
Institutions that keep mortgages on their balance sheets, including insurance companies and non-U.S. banks, focus on top-tier buildings in large metropolitan areas. CMBS issuers fare better in secondary and tertiary markets because they can get the higher rates they need to cover the costs of packaging and selling loans.
Primary markets include metropolitan areas such as New York and San Francisco that are mostly located on the U.S. coasts, while secondary and tertiary markets are comprised of smaller cities and towns. Some of these markets didn’t experience as much of a downturn because they didn’t experience as much of an upturn during the boom years. What people are really looking for is stability. You can find good, stable properties in secondary and tertiary markets.
Will you wish there was a housing crash in Singapore if you can get a 3-bedroom luxury apartment at The Sail over looking Marina Bay Sands for just $3,000 a month? The equivalent was what happened in Miami.
Brandon Klein, a 26-year-old tax accountant, stays at 50 Biscayne Boulevard, one of the luxury holiday condos built during the 2004 to 2008 boom to attract second-home buyers. Housing market has plummeted in end 2008, and with 7,000 unsold condos, almost a third of the 22,079 units in 75 buildings in Miami’s core, it has transformed Miami. With US$2,700 shared among 3 friends, Brandon is living in an apartment with 24 hour concierge, a ‘sick’ view of Downtown and a life he can never imagined. Some areas, previously only middle aged wealthy appear have transformed into dorm like residences. Interestingly, this has infused life into the vacation beach environment.