Archive for January, 2010

21
Jan
10

Severe Shortage in Development Financing?

By thefernandezgroup Leave a Comment
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A recent article today suggested an upcoming shortage in the apartment market. Industry experts have predicted that because of limited resources for development financing, the demand for apartments will exceed supply by 2011. They also mentioned that shortage of rental and condo properties will continue to increase throughout 2014.

80,000 units will be built this year, 220,000 short of what is needed for the increase in demand. As a result of the shortage, NAHB (National Association Home Builders) is forecasting market rents to rise 8% – 10% through 2012 and 4% – 7% through 2015.

Due to the lack of development financing, some developers are shifting their focus from developing to now buying. For developers that are seeking debt and equity financing, for development or acquisition, The Fernandez Group is still funding.

Here are some general guidelines:

  • Normal construction loans to 65% loan to cost (LTC) for most commercial projects up to $10 Million
  • Hotel construction loans to 70% LTC in major metro markets to $8 Million
  • Strong development loans above $10 Million with a combination of debt, equity and mezzanine can get up over 80% LTC
  • A Trade Program that is sourced and vetted which can net a project up to $40 Million for $10 Million on deposit that never leaves the clients’ control
  • Rural development construction financing out West up to 85% LTC up to $5 Million
  • FHA construction financing up to 90% LTC from $2 Million to $5 Million
  • And,  SBA build out financing nationwide

To send your project financing scenario contact The Fernandez Group at info@thefernandezgroup.com or visit us online at http://thefernandezgroup.com

12
Jan
10

Commercial Mortgage Lenders and Commercial Mortgage Brokers, a Partnership

By thefernandezgroup Leave a Comment
Categories: Solutions
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Here is a great article I found regarding how commercial mortgage brokers and lenders are partnering to successfully close transactions…

In today’s economic environment its difficult for commercial mortgage lenders to find a good commercial mortgage broker. Given the economic recession and the reduced commercial mortgage activity in the real estate capital markets, commercial mortgage brokers are under pressure to generate commission income and may not be advising their client as objectively as in the go-go days. Furthermore, it is typically taking 3 to 4 times as long to close a transaction as compared to before the recession began. These characteristics of today’s commercial loan market make it important for a borrower to do their homework prior to engaging a broker.

Commercial lenders rely on skilled brokers to carefully analyzes the transaction and surveys the capital markets for a mortgage or financing that best meets the client’s needs, and processes and closes the deal. Both commercial mortgage lenders as well as business owners can have a mortgage broker identify which lenders are active in the market, and desired loan product, and negotiate on the lenders and borrowers behalf.

It’s important to the capital providers for all their finance brokers they work with to maintain the highest standards of integrity and ethics in their business practices and maintain a steady analytical approach and keen market observation. Experience and relationships in the lending market are important aspects of a solid partnership between commercial loan brokers and lenders. A competent loan broker is well skilled to handle the needs of the real estate borrowers and commercial lenders, and begins by carefully analyzing the client’s needs and the characteristics of each transaction. They underwrites and package a financing request for the lender and confer with the borrower regarding its content and financing request. Strong commercial brokers are often able to structure a creative solution derived from their extensive knowledge of the capital markets. Oftentimes a commercial loan lender is used to structuring a loan in a certain way. A proficient finance broker is able to help both parties arrive at a structure which works best for both the borrower and commercial mortgage lender.

Capital providers offer cutting edge terms to skilled brokers with a prove track record of success and assign senior level professionals, oftentimes the decision-maker, to work with the broker because of their large business flow and technical expertise. Some brokers can work quickly and place a transaction within hours if necessary, and can close institutionally priced loans in little as eight business days and ‘hard money’ loans in two days.

Read more about Commercial Mortgage Lenders and their working relationship with commercial mortgage brokers

Article Source: http://EzineArticles.com/?expert=Michael_J._Schwartz

05
Jan
10

Big City Funds for Smallville USA

By thefernandezgroup Leave a Comment
Categories: Solutions
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For 2010, I have promised myself to get into the best shape of my life physically, spiritually and financially. Every morning I make it a point to get a little excercise before I start my day, at least 1 hr. It’s a habit of mine, a lifestyle that has made an impact in my daily productivity levels. Fortunately, the local gym is about 2 miles from where I live.

Not yet quiet ready for the 2 mile jog to the gym, I get into my car and drive through the 1 stop light and 3 stop signs before I reach the gym. I never imagined that living in a smaller town of 47k could be so eye-opening. I actually take my time driving. Coming from a bigger city of  1 million+, there is constant traffic, honking horns, cars screeching donuts in in the middle of the night, along with other distracting events. Although I’m just 25 minutes away, I can’t say that I miss it.

After my workout I usually drive around town, discovering more and more about the real estate and businesses. As I drive around this town I see so much opportunity. With the town just south of Silicon Valley within county limits,I believe this area is poised for more growth and development in the near future.

Collectively,  the surrounding areas including South San Jose, Morgan Hill, Gilroy, Hollister, Watsonville, Salinas, Santa Cruz, and Monterey, is where I will be focusing my efforts in bringing real estate project financing and business funding resources to the local investors and business owners.

Teaming up with one of the largest commercial lending companies in the country, we will provide hundreds of funding sources to compliment the local banking institutions.

Our vision is to be a partner within these areas supporting local communities and their growth objectives.

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