Star News

In June of 2008 the idea of establishing a “Bad Bank” in which to purchase and hold toxic assets was seriously considered by the FDIC. Proposed as a solution to clean up banks’ respective balance sheets and reset the lending process for consumer and real estate loans, the intent was to allow such toxic assets to be ‘marked to market’ and sold to a large number of investors, currently sitting on the sidelines waiting for the assets to be discounted.

After eight months, we have heard nothing further about such a proposal. We can point to the RTC (Resolution Trust Corporation) as a perfect example of how this concept had already worked during the savings and loan meltdown. Why wouldn't the FDIC implement the equivalent of the RTC today? What was so bad about the “Bad Bank” idea? We will keep you posted…

Penstar recently obtained a loan quote for the refinance of a 3-tenant industrial property located near Salt Lake City, Utah. Currently 100% occupied, the 120,000 square foot property is leased to 3 industrial tenants. The lender provided a 20-year loan term at 7.25% and with a 20-year amortization. To discuss, please contact Steven Hamermesh at (818) 883-9609 or Hamer@PenstarAdvisors.com.

Penstar is working with a lender funding acquisition and refinance loans on apartment complexes nationwide. The lender will provide 5-year fixed money at 5.85%, and 7-year & 10-year fixed money at 6.1% respectively. All loans will be amortized for a maximum of 30 years. Lower LTVs and higher DCRs will provide borrowers with a lower coupon. The loans will be underwritten at a 1.25 debt coverage ratio. Cash out refinances will be considered. To discuss, please contact David Stepanchak at (818) 883-9611 or DStep@PenstarAdvisors.com.

Helpful Humor

We at Penstar understand the challenges of the commercial real estate business. The best antidote for those challenging transactions is to take a moment to have a hearty laugh. Helpful humor is our way of infusing laughter into your work week. The anecdotes may not all be real estate themed but we hope you will enjoy them just the same.

Insufficient Funds

In tears, a young college co-ed came running to her father crying: “Daddy, you gave me some terrible financial advice!”

“I did? What did I tell you?” he asked.

“You told me to put my money in that big bank, and now that big bank is in trouble.”

“What are you talking about?” He replied, puzzled. “That's one of the largest banks in the state,” he said. "There must be some mistake.”

“I don't think so,” she sniffled. “They just returned one of my checks with a note saying, Insufficient Funds.”