FINfacts Newsletter XIX-2

Looking back, if 2009 could be labeled �The Year of Fear� in the Capital Markets, 2010 was �The Year Of Uncertainty� and 2011 is �The Year of Recovery�.   Even with the uncertainty, GSP arranged 89 loans with 41 different capital providers in 2010.  Significantly, the majority of this activity was in the last half of the year.  We are proud that we enabled our clients to access a wide spectrum of financing sources for their projects.      
 
Late 2010 was a turning point in the capital markets.    The year started out with some very cautious optimism.    Momentum built as more lenders and programs entered the market. �The strike zone is getting bigger� was a common refrain as loan officers visited our offices.    Here is a look at the breakdowns: 

Lender Type:   The most loans were done with Banks.  As 2010 progressed, most of the banks completed their capital raising exercises and were looking to get back to the business of lending.  Many commentators are still saying that the community banks are out of the market and that the only loans getting done are institutional quality.  This is a myth as evidenced in the statistics below.   Next, Fannie Mae, Freddie Mac and HUD accounted for a big share of our volume, including some large,high profile transactions.  Significantly, GSP closed a $112M HUD loan which we are told is the largest single asset loan HUD has guaranteed to date.    CMBS came back quicker than most expected, 6 closed transactions, look for MUCH more CMBS in 2011.
 
Property Type:   Apartments led the way as borrowers rushed to lock in record low fixed rates.     Overall, volume was concentrated among the core 4 product types, which was appropriate for the early part of this new cycle.
 
Financing Type:   Permanent financing was huge this year as stabilized properties were very much preferred by lenders.  However, it is notable that GSP closed 16 bridge loans and 5 construction loans, many in the 2nd half of 2010.   Again, we look to do more bridge/construction in 2011.   

Looking forward:  Our pipeline is robust going into 2011 across the property types.  As the markets improve, we have hospitality and special purpose loans in application.  We have some home building transactions moving forward and we see a continued expansion of opportunistic bridge and equity interest.  We look forward to a very active 2011.
 
� Note that two loans closed �at the buzzer� at year end and were not included in last week�s estimate.