Noteworthy News
Signs of the Times? For as many who say that the capital markets crises is easing or ending or whatever, there is daily evidence that things are not quite that rosy as shoe after shoe continues to drop. A number of this week’s shoes included the following:
IMF PREDICTS FURTHER PAIN FOR GLOBAL ECONOMY
Dampening expectations for an early exit from the ongoing global economic recession, the managing director of the International Monetary Fund, Dominique Strauss-Kahn, warned on Monday that "the large part of the worst is not yet behind us." Source: The Independent
U.S. TO OVERHAUL SECURITIZATION MARKETS
The U.S. Treasury is planning to overhaul securitization markets with tough new rules designed to reduce the incentive for lenders to originate bad loans and flip them on to investors. The rules will force lenders to retain part of the credit risk of the loans that are bundled into securities, and to end the gain-on-sale accounting rules that helped spur the heart of the financial crisis. The plan is part of a wider regulatory overhaul to be unveiled on Wednesday.
Monday’s Numbers
Year-to-Date Equity Market Performance (as of June 21, 2009):
DJIA(1): -2.70%
S & P 500(2): +1.99%
NASDAQ(3): +15.88%
Russell 2000(4): +2.66%
MSCI U.S. REIT(5): -15.73%
(1) Dow Jones Industrial Average.
(2) Standard & Poor’s 500 Stock Index.
(3) NASD Composite Index.
(4) Small Capitalization segment of U.S. equity universe.
(5) Morgan Stanley REIT Index.
U.S. Treasury Yields: (as of June 20, 2009)
3-month: 0.17%
6-month: 0.31%
2-Year: 1.20%
5-Year: 2.80%
10-Year: 3.78%
Indicated Spreads for Conventional Fixed and Floating Commercial Mortgages (as of June 10, 2009)
Beginning with this week’s update, we will include rates for floating-rate, 3 to 5 year mortgages.
| Property Type | Mid-Point of Commercial Mortgage Rate Spreads for 5-10 Year Fixed-Rate Mortgages | ||||
| 4/2/09 | 4/30/09 | 5/13/09 | 5/27/09 | 6/10/09 | |
| Multifamily: Non-Agency | +350 | +350 | +293 | +280 | +280 |
| Multifamily: Agency | -- | -- | +225 | +265 | +265 |
| Regional Malls | +513 | +513 | +525 | +518 | +518 |
| Strip/Power Centers | +575 | +575 | +530 | +463 | +463 |
| Multi-Tenant Industrial | +500 | +475 | +470 | +460 | +460 |
| CBD Office | +500 | +513 | +465 | +455 | +455 |
| Suburban Office | +525 | +525 | +500 | +460 | +460 |
| Full-Service Hotel | +600 | +600 | +588 | +563 | +563 |
| Limited-Service Hotel | +600 | +600 | +600 | +588 | +588 |
| 5-Treasury | 1.76% | 1.89% | 2.09% | 2.13% | 2.58% |
| 10-Year Treasury | 2.69% | 3.10% | 3.10% | 3.56% | 3.98% |
| Source: Cushman & Wakefield Sonnenblick-Goldman, LLC. | |||||
| Property Type | Mid-Point of Floating Rate Commercial Mortgage Rate Spreads for 3-5 Year Fixed-Rate Mortgages | ||||
| 4/2/09 | 4/30/09 | 5/13/09 | 5/30/09 | 6/10/09 | |
| Multifamily: Non-Agency | +475 | +475 | +475 | +475 | +475 |
| Multifamily: Agency | NA | NA | NA | NA | NA |
| Regional Malls | +550 | +550 | +550 | +550 | +550 |
| Strip/Power Centers | +575 | +575 | +575 | +525 | +525 |
| Multi-Tenant Industrial | +500 | +500 | +475 | +475 | +475 |
| CBD Office | +550 | +525 | +500 | +500 | +500 |
| Suburban Office | +600 | +600 | +600 | +600 | +600 |
| Full-Service Hotel | +650 | +675 | +650 | +650 | +650 |
| Limited-Service Hotel | +710 | +725 | +725 | +725 | +725 |
| 1-Month LIBOR | 0.50% | 0.43% | 0.40% | 0.31% | 0.32% |
| 3-Month LIBOR | 1.19% | 1.04% | 0.99% | 0.75% | 0.65% |
| Source: Cushman & Wakefield Sonnenblick-Goldman, LLC. | |||||
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