"It helps when the building is fully leased and has a good occupancy history like this," Steve Roth, partner with Cohen, tells GlobeSt.com. "It's a functionally sound piece of real estate with good sponsorship. It's a combination of all of those things put together."
"There's not a question that it's challenging to secure financing in today's environment, but it depends on the quality of the deal and sponsorship," Roth says. "What's you're seeing is a deleveraging going on in loan-to-values, no just in real estate but across capital markets. You used to be able to do an 80% loan, but now it's more like 65%, and at the same time values are down."
The Wrightwood Capital deal was a fixed-rate, 60% LTV loan. Roth says tight debt markets will make refinancing in this market as difficult as many people have seen.
"Anytime you've got any type of debt maturity you're facing today or in the near future, you have challenges to overcome as it relates to debt capital," Roth says. "Anybody that has a loan that's maturing in the immediate future with low leverage is going to address the recapitalization of that asset. It's a very difficult dynamic and it's real estate, corporate, or municipal debt because there just aren't many buyers of paper period in the global economy."
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