Capital Markets Have a Long Way to Go via NREIonline.com

Lenders like commercial real estate. They really do. But they have concerns about the global economy, and that makes them unwilling to finance anything other than quality assets in major markets owned by strong sponsors.

“There’s been no meaningful job growth and uncertainties with U.S. debt and Europe just won’t let people believe the situation will be better six months or a year from now,” says Steve Holle, a regional director with Northwestern Mutual, which originated $4.5 billion in commercial real estate loans in 2011.

Even though mortgage originations have increased annually since the credit crisis, and even the once dormant conduit market is coming back to life, Holle says the capital markets are still far from normal. “The focus is strictly on high-quality, core real estate in primary markets,” he says.

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