Tag Archives: Commercial Real Estate

CrunchedCredit.com’s 8th Annual Golden Turkey Awards

As we look back each November to bestow the year’s crop of Golden Turkeys to the silliest and most annoying instances of regulatory overreach, legislative inanity, governmental misfeasance or the mere idiotic behavior of people without any help from the government apparatchiki, there’s always a glorious excess of candidates. This whole commentary thing would be … Continue Reading

HVCRE Reform is HOT HOT HOT: Pittenger Bill Progresses to Senate

Add HVCRE reform to the list of things that have bi-partisan support (currently on the list: flag pins and banning the use of Twitter in the White House). On Tuesday, the House passed (with bi-partisan support…which should bolster its chances of passing in the Senate) H.R.2148 – Clarifying Commercial Real Estate Loans, otherwise known as … Continue Reading

Yakety Yak – Talk Back: Regulators Respond to HVCRE Complaints

On September 27, 2017, the Federal Reserve, FDIC and OCC released a Notice of Proposed Rulemaking (NPR) that they describe as simplifying compliance with certain aspects of the agencies’ risk based capital (RBC) rules to, among other things, replace the standardized approach’s (SA) treatment of HVCRE loans with a simpler treatment for most acquisition, development … Continue Reading

It’s the Taxes, Stupid

In this commentary we have talked about a lot of challenges facing commercial real estate finance and other capital market activities over the years.  With more or less “pants on fire” anxiety, we’ve talked about Dodd-Frank’s regulatory compliance burdens, the Volcker Rule, Risk Retention, the glorious and multitudinous products of the gnomes of Basil, the … Continue Reading

A Tale of Two Years; This Time Will Be Different

The Wall Street Journal reminded us this month that it was ten years ago, August 9, 2007, that the first regulatory domino in The Great Recession fell as BNP Paribas froze a series of resi investment funds for lack of a functioning market to value the securities. One could quibble about whether The Great Recession could … Continue Reading

Fun With GAAP:  CMBS at Risk

Here’s a headline for you:  We don’t know if a conventional CMBS securitization where risk retention bonds are retained by a B-buyer under an industry standard third party purchaser agreement achieves accounting sale treatment.  Failure of accounting sale treatment means the selling bank cannot book the gain and does not derecognize the underlying loans resulting … Continue Reading

Direct Issuance is Here – A New Paradigm for Single Asset Single Borrower (SASB) Securitization

A standalone securitization of a portfolio of properties closed in June. To our knowledge, this was the first transaction in recent memory done in a direct issuance format.  In this case, direct issuance means that the sponsor organized the lender and the depositor as well as a borrower and crafted the loan between the lender and … Continue Reading

HVCRE: Busting Myths

The Trump administration and Congress have lots on the agenda: tax reform, financial regulation reform, job creation (think infrastructure spending, maybe?) and more. While it seems unlikely that much of anything “real” is going to happen anytime soon or even this year (other than more drama, more tweets and more Trump-isms), there’s some hope for … Continue Reading

New Year! New Administration! Same EB-5 Dilemma!

Since 2015, we here at Crunched Credit have tracked, followed and discussed the developments (or lack thereof) concerning the Immigration Investor Program, more commonly known as the “EB-5 Visa Program.” Throughout the past year, we’ve witnessed the approval of several extensions of the EB-5 Visa Program and in each instance, no substantive changes were included—these … Continue Reading

“Shaking” Things Up: Seismic Risk Assessments

Returning to our theme that nothing’s easy and everything keeps changing, here is one out of left field. Let’s talk Probable Maximum Loss (“PML”) and seismic risk. ASTM International, the market standard setting organization for everything from toilet bowls to condoms, has just issued an amended seismic standards: Standard Guide for Assessments of Buildings (E2026-16) … Continue Reading

Text on the Dotted Line: A Text Message Can Create a Binding Contract

Here’s another story in the “It never gets easier” file. The Massachusetts Land Court recently decided a case that perhaps we should have all guessed was coming. This is the above the fold headline:  Text messages may now create binding contracts.  Specifically, a text message can constitute a signature sufficient to satisfy the Statute of … Continue Reading

A Trip Through the Labyrinth – The Regulatory Man in Full

And now to return to our commentary a few weeks back about the stultifying impact of ill-thought through rules and regulations (at best) (Brexit has intervened).  This is our Regulatory State which broadly attempted to pick winners and losers and modify market behavior, to get an engineered outcome by using the blunderbuss of proscriptive rules … Continue Reading

CREFC Annual Conference 2016: Headwinds or Head First Into the Wall?

The slow start to 2016 did not dampen the enthusiasm at CREFC’s Annual Conference, held last week in New York City.  The conference saw record attendance, with standing-room-only crowds at virtually every panel.  As with the Industry Leaders Conference in January, the hot topics on people’s minds were risk retention (and the rest of the … Continue Reading

Risk Retention: It’s the Fourth Quarter and the Home Team is Getting Glum

We thought it would be useful to give a quick, interim update on the slow-motion train wreck that is our industry’s response to the upcoming effectiveness of the Risk Retention Rule.  For those of you who have been blessedly snoozing under a rock these past couple of years, the Risk Retention Rule becomes effective on … Continue Reading

Cuba and the Booming Commercial Real Estate Industry to Come

On March 20, 2016, President Obama became the first United States president in almost 90 years to visit the island of Cuba, located a mere 90 miles from the coast of Florida—signaling not only a renewed diplomatic relationship between the United States and the communist country, but also, the dawning of a new commercial age … Continue Reading

Flash: Congress Fixes the CMBS Risk Retention Problem (Just Kidding)

Last week, the House Committee on Financial Services reported out the Preserving Access to CRE Capital Act of 2016 (the “bill”) in a remarkably bipartisan sort of way (paving the way for: “Well, yes, I did vote for it, but then I voted against it.”).  The bill, which was drafted and backed by CREFC, would … Continue Reading

If Interesting and Prosperous is a Choice, I’ll Take Door Number Two: Perspectives on 2016

As we do each year at Crunched Credit, we take the end of a calendar year as an opportunity to stop and reflect on where we are, and what the next year might hold. Recognizing the certainty that a successful prediction is more a random event – a blind cat finding a dead mouse, than … Continue Reading

With Its End in Sight, EB-5 Survives!

In an uninteresting turn of events last week, Congress has passed the Omnibus Bill, which contained a provision extending the EB-5 program until September 30, 2016, with no other changes to the program. As previously discussed, the last couple of months have been filled with substantial discussions and the introduction of potential legislation aimed at … Continue Reading

The Death of EB-5 Has Been Greatly Exaggerated

Earlier this year we discussed the uncertain future of the EB-5 Visa Program, one of the most successful inbound investment programs of recent years, as evidenced by the $5.2 billion dollars the program has generated in the past ten years alone. Although the EB-5 Visa Program was set to expire on September 30, 2015, Congress … Continue Reading

HVCRE: Surrender Is Not An Option

The way the new Basel III High Volatility Commercial Real Estate Lending Rule (HVCRE) was crafted, and is being enforced, is insane. We’ve written about this before.  This is one of the purest examples of the regulatory apparatchik’s mule-headed refusal to look at data or engage with the banking establishment to develop thoughtful and effective … Continue Reading
LexBlog