Plentiful capital will be available in 2012 for core assets, even as those assets are becoming increasingly scarce, according to a recent report from CBRE Capital Markets. The report also foresees a continuation of the “deal velocity” of recent months, and increasing competition among lenders.
The demand for capital will be so great, however, that some life insurance companies may be forced to increase their loan allocations from 10% to 25% in the coming year, according to the same report. “We continue to see real estate and mortgage finance fundamental gradually improve, and with the availability of substantial capital, commercial real estate continues to become more of a core investment alternative and one that can provide very attractive risk-adjusted returns,” according to the report, authored by CBRE Capital Markets president Brian Stoffers.
Not all lenders are thriving in the current environment, however.CMBS conduit lenders, however, may turn out to be big wallflower at the lenders’ ball, according to the CBRE report.
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