Are Lenders Supposed to Make Loans?

In the absence of new loan production, banks and insurance companies may reflect back on 2009 and wonder why their respective interest and fee incomes fell so short of budget. Some lenders, who share the perspective that today’s loan environment is too risky for their current capital base, have opted to remain on the sidelines. Other debt providers have conservatively and selectively, extended loans only to existing customers or on portfolio notes that have ballooned. Yet another group of lenders with funds available have chosen to establish underwriting criteria so rigid that only loans below 50% of today’s value will be considered.

Given the present economic climate, active lenders have the ability to acquire customers who have been dislocated from a prior lending relationship. Debt financing is still available for well qualified borrowers with ‘over the plate’ transactions. Lenders with allocations may find themselves having to reduce debt coverage requirements if they hope to hit their annual production goals. We will keep you posted…

Penstar Realty Advisors Announces the Formation of Penstar Net Lease Advisors

Penstar Net Lease Advisors (PNLA) was established to match owners of single tenant office, industrial, retail, and special use properties with buyers seeking net-leased assets. The PNLA division is overseen by Steven Hamermesh, a 28-year veteran of the sale of net leased properties nationwide.

Currently, PNLA has a number of quality net leased properties not actively on the market. Transactions range from a $1 million retail-pad ground lease to a multi-million dollar industrial and office complex. Tenants range from those of investment grade to strong private companies. Most transactions are commercial real estate assets with little or no landlord responsibility, and viewed as a passive cash flow investment.

Sellers will have the benefit of PNLA exposing their property to our vast list of active buyers; buyers who have a demonstrated capacity to close on acquisitions nationwide for all-cash or cash to a new or assumed mortgage. This exposure will allow PNLA, on behalf of the seller, to command the most aggressive price for the asset.

Buyers will have access to quality NNN properties, many of which will not be actively on the market. Furthermore, the selection of properties will allow the buyers to choose the preferred location, credit quality, and return that best meet their investment objective.

To confidentially discuss selling or acquiring properties, please contact: Steven Hamermesh, CEO, Penstar Net Lease Advisors, Inc. at (818) 883-9609 or Hamer@PenstarAdvisors.com.

Penstar recently identified a lender actively funding short-term floating rate loans on stabilized office, industrial, retail, and apartment properties located in the Western United States. The lender will offer 3 to 5-year terms at Libor plus 350 basis points. Loans will be underwritten to a 1.20 debt coverage ratio using a 10% mortgage constant. Recourse can be limited to a 20% top end repayment guarantee. To discuss, please contact David Stepanchak at (818) 883-9611 or DStep@PenstarAdvisors.com.

30 Day Libor	10-Year Treasury	Prime
0.49%	2.76%	3.25%

Penstar Realty Advisors can be reached at (818) 883-8600 or at our offices located at:
21700 Oxnard Street, Suite 1870, Woodland Hills, CA 91367