APARTMENT FINANCE TODAY

Andre Shashaty, Editor
ashashaty@hanleywood.com

Crunch Time? Everyone in real estate knew the free flow of capital for deals of any size, shape, or degree of viability could not last forever. You have all read enough about the sub-prime home mortgage industry's problems, but the big news is how fast and wide the fears about credit quality are spreading. My friends in the financial world talk about credit markets entering a "free-fall." The big multifamily players say it hasn't really hurt their ability to finance deals yet, but they also know that there is no way to predict how far the chaos will spread. In other words, the easy money that has been supporting multifamily values and fueling so much activity could disappear tomorrow. Literally. And for some deals in weaker markets, it may already be gone. We will be monitoring the changes in debt and equity availability closely in future issues of APARTMENT FINANCE TODAY magazine.
If you have experiences with your lenders and investors that show how their interests and terms are changing, please let me know.

Developers hoping for lower construction prices have been foiled again. Though a handful of materials are cheaper than last year, overall prices keep rising faster than inflation for all types of apartment construction and are likely to continue doing so for the foreseeable future.
FULL ARTICLE

From Boston to Dallas, good workers and materials are hard to find. Still, savvy strategies are keeping smart developers in the black.
FULL ARTICLE

Freddie Mac has changed its early rate lock program to speed up deal cycle time and reduce the amount of money a developer has to put up in advance. Additionally, the government-sponsored enterprise (GSE) has rolled out changes to its standard interest-only (IO) product, while introducing a new product for acquisitions and more yield maintenance flexibility to the IO program.
FULL ARTICLE

Silicon Valley real estate mogul Carl Berg just reported that the $1.8 billion deal to sell his portfolio of buildings has fallen apart, a victim of the credit crisis rocking the financial world. In a tangible sign that the crisis crippling the housing market is spreading to commercial real estate, Berg said the buyer, whom he refused to identify, simply could not obtain a loan to buy Berg's 6.9 million-square-foot portfolio.
FULL ARTICLE

Wall Street financial firms, saddled with hundreds of billions of dollars in debt commitments that fueled this year’s explosion of private-equity buyouts, got a major wakeup call this week when apartment REIT Archstone-Smith Trust (NYSE: ASN) announced a delay in its $15.2 billion sale to a joint venture of Tishman Speyer Properties and Lehman Brothers Holdings Inc. The keenly watched deal is the second-largest real estate buyout in history, eclipsed only by the $39 billion acquisition of EOP by The Blackstone Group.
FULL ARTICLE

Mortgage finance giants Fannie Mae and Freddie Mac will not be allowed to take on more debt, the government announced, denying requests to relax the companies' investment caps as a way to pump cash into the struggling mortgage market.
FULL ARTICLE

American Home Mortgage Investment Corp. filed for bankruptcy protection last week and two other mortgage lenders said they were not accepting new applications, signs that the worst housing crunch in decades could be widening.
FULL ARTICLE

Events/Announcements

Developer Conference
September 11-12, 2007
Washington, DC

Multifamily Executive Conference
October 2-4, 2007
Las Vegas, NV

AHF LIVE!
October 24-26, 2007
Chicago, IL

Check our online calendar for more upcoming events.

HOUSING FINANCE BLOG

Read about deals, subsidies, gossip, taxes, and sneaky fine print in the world of rental real estate, from the editors and writers of APARTMENT FINANCE TODAY here.

To reach APARTMENT FINANCE TODAY Executive Editor Christine Serlin, please e-mail cserlin@hanleywood.com

To reach APARTMENT FINANCE TODAY online editor Jaime Windon, e-mail jwindon@hanleywood.com.

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