Finance Outlook: Awesome
South Florida experts are optimistic about the outlook for the capital markets. We're coupling that news coverage with our trip toMBA out in California because who doesnt like talking about money?
HFF exec managing director Manny de Zarraga, who oversees the companys Southeast practice, tells us that after increasing activity last year, CRE will further solidify its position in 2013 as an attractive investment from debt and equity perspectives. There will be a strong level of commercial real estate capital markets activity this year, he notes. HFF is beefing up its Florida operations to deal with this ramped up activity, hiring a new director in its Miami office (Marty Busekrus, to focus on industrial investment sales), and a slew of new real estate analysts.
Miami-based SL Capital CEO Constantine Scurtis expects CMBS volume to increase. With the central bank remaining an active buyer of mortgage backed securities, interest rates will stay low, he says. This is positive for the CMBS market. It's a win for borrowers who need loans, and its a win for investors to buy CMBS bonds because of their attractive yields. Investors are searching for any yield they can find." Constantine predicts that total CMBS volume will break $60B in 2013, compared with $39B last year and $27.3B in 2011.
The Fed might be keeping rates low for now, but one question hanging over CRE finance these days is how long the golden age of low rates can last. Delray Beach-based HC Real Estate Capital principal Chris Caveglia tells us that hes seeing borrowers locking in current rates for loans maturing as far as 24 months out. With so much uncertainty in the future of interest rates, many borrowers are taking the refinance risk off the table, even if it means paying a small premium to lock in today's rates, he says. Recently Chris and HC principal Kurt Hoffman arranged $6M in financing for Sedanos Plaza in Pembroke Pines (pictured).
Speaking of big bucks, the developers of Marina Palms Yacht Club & Residences, Miami-Dades first condo-plus marina development in quite some time, recently presented an oversized check for $200,000 to the City of North Miami Beach as advance payment on impact fees. Developed by the DevStar Group and the Plaza Group, the two residential towers will include 468 condo units, and the marina and yacht club will offer 112 slips with mooring for yachts in excess of 90 feet. Pictured: Plaza Group prez Neil Fairman, North Miami Beach Mayor George Vallejo, and DevStar principal Anthony Burns.