"Investors are selling their core holdings in New York andBoston, looking for opportunistic investment acquisitions insecondary markets," Andrew Little, principal with John B. Levy& Co., a real estate investment-banking firm headquartered inRichmond, tells Globest.com.
Little uses a client's recent refinancing of a 30-year-oldbuilding in Portsmouth to illustrate the trend. PepperwoodTownhouse Apartments--consisting of 141 units in 22 buildings--wasrefinanced for $9.4 million at a fixed rate that was below 6%. The10-year loan has interest-only payments for the first fiveyears.
"It's a very aggressive loan on a property that has been aroundfor more than 30 years," Little says. The sponsor was able toarrange these terms, he adds "because it is a solid secondarymarket."
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
