Who said credit has dried up for commercial real estate? Sure, not a day goes by that there isn’t an article or report published discussing the trouble looming in commercial real estate from maturing debt that can’t be refinanced to lenders selling notes at bargain basement prices just to get them off their books. However one corner of the market that is bucking this trend to a degree is the smaller transaction with the portfolio lender.
Crain’s recently did a profile piece on a deal that was sold by Massey Knakal to a long time property owner where he was able to secure financing from the Bank of Smithtown. These portfolio lenders and community banks have avoided much of the turmoil caused by the securitization market and are typically more conservative in their underwriting and because of these good business practices they are still able to do business.
“While the market for Manhattan office towers has all but ceased to function, sales of multifamily properties and smaller commercial buildings for $2 million to $50 million are moving along. Supporting that resilience: a host of small and midsize banks, some of which have actually stepped up their real estate lending over the past year.”