As published in Scotsman Guide's Commercial Edition, May 2009.
With his group expecting nearly 50,000 attendees to its RECon Global Retail Real Estate Convention this month (May 17-20, icsc.org/2009SC), International Council of Shopping Centers President and CEO Michael Kercheval told Scotsman Guide writer Jennifer E. Garrett of his retail sector's biggest challenge.
"It's all about capital markets," Kercheval said as part of our Q&A. "There's a lot of capital [out there], but it's not flowing."
Undoubtedly, folks from all ends of commercial real estate finance would second that motion. The Mortgage Bankers Association announced that commercial originations for 2008's fourth quarter showed an 80-percent dive from the same period in '07, down 53 percent from the previous quarter. Hotel-property loans alone dropped 99 percent year-to-year.
To call lenders and investors finicky funders would be a severe understatement. But for brokers seeking to end the closing-table standoff, a little inside knowledge could go a long way.
This month's Scotsman Guide features numerous articles devoted to risk management -- and how to understand just what makes lenders tick.
In our Lead Article, IVI International Inc.'s George Wilson offers seven tips for helping assess a property's condition. Especially when dealing with potentially troublesome property types -- and really, what doesn't fall into that category? -- this due diligence is crucial to avoiding surprises and pitching a deal to the right lender.
Also in this issue, attorney Timothy E. Gilsbach of Fox Rothschild LLP takes another angle on property inspections -- examining when lenders blanch at the prospect of stating too much in the inspection stage.
Meanwhile, an article from Hatch Jacobs LLC's Gary A. Horton looks at lenders' growing practice of having borrowers form single- or special-purpose entities to mitigate banks' risk in case of bankruptcy.