The residential rental asset class is one of the most sought-after investments by purchasers of commercial real estate. Investors from around the world, including private equity funds, real estate investment trusts and established long-time owners of real estate, all want to own this asset class, especially if the property is located in New York City.
The purchasers and the owners of this property class have been fortunate that the majority of commercial and savings banks, as well as Fannie Mae, Freddie Mac and Wall Street firms providing CMBS financing, are all very interested in financing rental apartments.
Everyone wants to operate a business in New York City. Companies from around the world travel to the Big Apple to expand their presence in the global market by staking out space here.
While the costs of operating a business in the city and in the region can be astronomical, the rewards can make it well worth it. So despite the challenges, each year a number of financial institutions from around the globe decide that it’s time to expand in New York in order to capitalize on companies’ desires to open shop or expand their operations here. As 2012 draws to a close, a number of new entrants from regional and national banks are elbowing in to gain market share in the New York tristate area by offering financing for commercial real estate. That means new hires.
Record-low mortgage rates have helped to fuel the nation’s refinancing activity for residential homes. In July, the number of mortgage applications filed hit a three-year high. Freddie Mac also reported that 30-year, fixed-rate mortgages averaged 3.49 percent for the week ending July 26.
Likewise, attractive rates are fueling financing in the multifamily market, where financing for low-leveraged rental buildings has reached its lowest levels in decades. The result? Fierce competition among lenders looking to provide financing for the asset class, particularly in the Big Apple.
On the heels of its announcement last week that it had completed the acquisition of 57 New York City area branch locations, Bridgeport, Conn.-based People’s United Bank has hired John Costa to head up its New York commercial real estate lending operations, sources told The Mortgage Observer.
Mr. Costa, who couldn’t be reached for comment, Read More