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2014 Triangle CCIM Market Forecast

2014 Triangle CCIM Market Forecast. March 19, 2014 | Raleigh, North Carolina. Outstanding U.S. CRE Debt. Total Commercial and Multifamily = $2.59+ Trillion Banks = $889 Billion (35.1%) CMBS/REMIC’s = $584 Billion (22.7%) GSE’s = $396 Billion (15.8%)

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2014 Triangle CCIM Market Forecast

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  1. 2014 Triangle CCIM Market Forecast March 19, 2014 |Raleigh, North Carolina

  2. Outstanding U.S. CRE Debt Total Commercial and Multifamily = $2.59+ Trillion • Banks = $889 Billion (35.1%) • CMBS/REMIC’s = $584 Billion (22.7%) • GSE’s = $396 Billion (15.8%) • Insurance Cos. = $337 Billion (13.5%) • Other = $384 Billion (12.9%)

  3. CMBS Maturities CMBS maturities 2015 – 2017 = $350+ Billion CMBS multifamily maturities next 5 years = $75 Billion = 9,600 + loans

  4. 2013 Lending Volume & 2014 Projections • 2013 LENDING VOLUME • CMBS • $87 Billion • Insurance Companies • $58 Billion • Fannie Mae / Freddie Mac $28.7 / $25.9 Billion • FHA • $23.89 Billion • 2014 VOLUME PROJECTIONS • CMBS • $110 Billion to Whatever? • Insurance Companies • $62 Billion • Fannie Mae / Freddie Mac • $28.7 / $25.9 Billion • FHA • $16 to $17 Billion

  5. Property Types • Multifamily – most liquid, I/O everywhere, local softness, national strength • Retail – anchored, focused on occupancy costs and rollover rents\ • Office – rollover, costs, rents, appear to be through the trough • Hospitality – get it while it’s hot • Warehouse/Industrial, self-storage, single tenant

  6. Capital Markets Update One Year ago: Today: • Rates: 10-Year UST – 1.60% • Spreads 200bps+ for Life Companies,300bps+ for CMBS • Overall, 3.50% - 5.00% • Rates: 10-Year UST – 2.68% • Spreads 125bps – 200bps for Life Companies,200bps – 250bps for CMBS • Overall, 4.00% - 5.00%

  7. Capital Markets Update • Proceeds: Investor appetite for CRE assets is robust • Amortization: I/O for the asking • LTV: Stated max of 75%, Mezzanine available to 85% • Rate-lock: Life companies, up to one year forward; CMBS, remains a trade • Prepayment: Life companies, YM but willing to deal; CMBS, Defeasance to maturity

  8. BB&T Real Estate Funding • Balance sheet financing, exclusively through Grandbridge • Fixed-rate, non-recourse, life company style • All property types, excluding hospitality at this time • Terms: 7 – 10 years • Amortization: 30 years; I/O available • Prepayment: Yield Maintenance for half the term only; 0.50% penalty thereafter

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