CMBS Spreads Blow out – Reliance on Non-traditional Debt and Equity Sources to Increase

There is no question that there is a tremendous amount of fear and volatility, which is pervading the marketplace and having an adverse impact on the cost of capital.

In addition, reliance on CMBS lenders is a fool’s errand, as loan levels and spreads are becoming increasingly unattractive.

Notwithstanding, borrowers who have an opportunity to either restructure or buy their loans back at a discount still have huge capital requirements that need to be fulfilled.

In addition, if there is a silver lining, it is that borrowers and owners may now have a window of opportunity to strike a better deal with their lenders and servicers, who are now even more anxious than ever to monetize over-leveraged loan positions and restructure transactions or enter into mutually acceptable DPOs in order to monetize these loan positions.

At Carlton, we possess tremendous relationships with domestic and international capital sources, who are well capitalized and who are eager to invest directly into today’s volatility.

Moreover, like any deregulated capital markets business, there is a huge disparity in how different lenders and investors price their capital. Now, more than ever, utilizing strong intermediaries, who can generate the best possible terms for you is essential.

As you may have seen, we have closed over $500 million in non-cash-flowing transactions in the last 30 days alone, which contributes to over $4 billion of closings within the last few months. Our client dedication and access to reliable equity and debt sources are second to none and I strongly encourage you to contact us to discuss helping you take advantage of the current market opportunity and accessing the best possible terms for your next acquisition and/or recapitalization.

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