Discipline is key in this turbulent #RealEstate market. Unfortunately you will see more of this in the coming months. Being positioned in specific asset classes will be crucial.
#Industrial#SeniorHousingTreeline
President @ Queens' College, Cambridge | Finance, Economics Expert
From The Wall Street Journal article, “A $10 Billion Real-Estate Fund Is Bleeding Cash and Running Out of Options.”
The liquidity challenge facing this fund is attracting attention well beyond the investors in the fund and in the sector as a whole.
Its remedial actions — namely, the mix between more borrowing, disposing of properties/assets, and restricting investor redemptions — will influence the extent of the spillover effects to other similar funds, the sector and creditors.
#econony#markets#cre#commercialrealestate#realestate
From The Wall Street Journal article, “A $10 Billion Real-Estate Fund Is Bleeding Cash and Running Out of Options.”
The liquidity challenge facing this fund is attracting attention well beyond the investors in the fund and in the sector as a whole.
Its remedial actions — namely, the mix between more borrowing, disposing of properties/assets, and restricting investor redemptions — will influence the extent of the spillover effects to other similar funds, the sector and creditors.
#econony#markets#cre#commercialrealestate#realestate
President @ Queens' College, Cambridge | Finance, Economics Expert
From The Wall Street Journal article, “A $10 Billion Real-Estate Fund Is Bleeding Cash and Running Out of Options.”
The liquidity challenge facing this fund is attracting attention well beyond the investors in the fund and in the sector as a whole.
Its remedial actions — namely, the mix between more borrowing, disposing of properties/assets, and restricting investor redemptions — will influence the extent of the spillover effects to other similar funds, the sector and creditors.
#econony#markets#cre#commercialrealestate#realestate
Managing Director at Basar Global Group-Private Family Office-1 Billion Macro Portfolio Advisor-Global CRE Capital Flow Advisory & Contrarian Research Consulting
Liquidity War Against CRE Continues As Fed Goes Illiquidity Long On Redemption WaterFall
Few CRE investors, regional banks & US citizens realize that all wars are banker wars. From early 2021 the central bank have been at war against commercial real estate & regional banks leverage concentration on CRE as the basis of wealth creation versus Wall Street derivative products & private equity.The June 2021 Fed gave specific instructions after refunding the largest banks with liquidity after the 2020 pandemic & 2008 GFC to restrict CRE lending. However, after a temporary pause,big banks could begin stock buyback risk against bank reserve.
And upon J Powell losing the Basel III reserve regulation to bank lobbyist who advise Congress they extended interest rates out to September & probable beyond.In the on again off again credit liquidity crisis of deglobal leverage capture & design.
Approximately $2.75 trillion in commercial mortgage loans will mature between 2023 & 2027 (Trepp.com,) leading to difficult decisions for lenders & borrowers facing layoffs & decreasing CRE syndication waterfall & redemptions.
There are 4000 small to medium banks at risk & 700 sitting on the tail of a QT donkey.I don,t think there is loan crisis but there is leverage,liquidity & long bond crisis.
The $15B Starwood Real Estate Income Trust said it fulfilled 63% of investor redemption requests in November after the repurchase requests exceeded a 2% limit, reaching 3.2% of net asset value.
Blackstone had noted that it has monthly withdrawal limits of 2% of net asset value & quarterly limits of 5% of NAV. It received $1.8B in redemption requests.Blackstone allowed investors to withdraw $1.3bn in November,43% of the redemptions.
It’s clear why they would do this. Real estate is not a liquid asset.A fund can’t easily sell shares to raise capital if necessary. Since prices & transactions volumes are flat.
In both cases,Asia where investors tend to use higher levels of leverage & many faced margin calls over turns in their domestic markets was the source of many of the redemption requests. Financial Times,reported that 70% of the redemption requests to Blackstone came from Asia, non-US investors make up only about 20% of the fund’s assets.
Mansa Musa of BGG says "there should be a limit on how much leverage investors can use going into a non-liquid investment fund would likely be empty, because the investors could use leverage elsewhere, leaving themselves vulnerable, as apparently happened in this case.
The regional bank space is facing is a lot of pressure on USTs,liquidity, with funding costs moving higher. At the same time, regulators are asking many regionals to increase reserves & keep more cash on hand.“I think that leaves us [in] a place where regional banks facing slow growth & less loans.
The result is that many borrowers will be unable to obtain a mortgage large enough to fully pay off the existing loan as the Fed pretend & extend QT, but with no flow for CRE.
President @ Queens' College, Cambridge | Finance, Economics Expert
From The Wall Street Journal article, “A $10 Billion Real-Estate Fund Is Bleeding Cash and Running Out of Options.”
The liquidity challenge facing this fund is attracting attention well beyond the investors in the fund and in the sector as a whole.
Its remedial actions — namely, the mix between more borrowing, disposing of properties/assets, and restricting investor redemptions — will influence the extent of the spillover effects to other similar funds, the sector and creditors.
#econony#markets#cre#commercialrealestate#realestate
Big potential shifts in the CRE investment landscape ⚖️
The expansion of private credit to individual investors through new financial products has huge potential to provide commercial real estate developers with increased access to alternative financing. But, there's no substitute for strong project fundamentals and the stable, investment-grade real estate projects are still going to be most attractive for fund managers.
While the potential for growth is huge, with the market projected to hit $3.5T by 2028, liquidity risks and regulatory hurdles remain key considerations. Check out this read from The Wall Street Journal to learn more.
#privatecredit#crefinance#alternativeinvestments#sidecarpr#financialtrends#wsj#commercialrealestate
Real estate funds require careful understanding and structuring. Fund managers should anticipate market changes, while investors should scrutinize the fund's dynamics. https://hubs.li/Q02kqw4V0#Funds#RealEstateFunds
Discover the latest insights on the real estate market in the new article from ETF Central.
Dive into the earnings season, see how over 175 equity REITs and other real estate entities are capitalizing on the changing interest rate environment.
Read more about how market dynamics are adapting and what it means for fund managers and investors in the private markets.
https://lnkd.in/ekeA6dW2#RealEstate#RealEstateInvesting
Active management may be making a comeback, but at Belle Haven Investments, we've unwaveringly adhered to our consistent and repeatable active management process since 2002.
If you're looking to enhance your fixed income portfolio and maximize your investment potential, partner with an active manager like Belle Haven Investments. By leveraging our expertise, experience, and unique investment approach, we are able to uncover hidden opportunities as we aim to generate higher returns for your clients. Additionally, we offer premium personalized service, extensive customization options, and strategic insights to support and elevate your practice.
#bonds#fixedincome#smas#funds#activemanagement#investing#assetmanagement#munis#munilandhttps://lnkd.in/enE6ERu8
Spreading Financial Life Awareness l Looking to connect with CFPs aspiring to start their own Fin. plng. practice l 361 degrees Financial Life solutions l No Fin. Product sales
