Daily market intelligence on mortgages, equity raising, investment sales, and CMBS.

Monday, 18 May 2020

Wells Fargo: Coronavirus Could Lead to 34 Percent Drop in Property Prices

Prices for commercial properties could drop by nearly 34 percent this year as a result of the efforts undertaken to stem the coronavirus pandemic, according to Wells Fargo Securities. That would be in line with the 31 percent decline over the first two years after the Global Financial Crisis. But prices, this time around, should recover more quickly.

Commercial Real Estate Direct Staff Report

Prices for commercial properties could drop by nearly 34 percent this year as a result of the efforts undertaken to stem the coronavirus pandemic.

Wells Fargo Securities' CMBS research team, which made the forecast this morning in its CMBS Coffee Chatter report, noted that the drop would be in line with the 31 percent price drop over the first two years following the Global Financial Crisis, 2008 and 2009. Its forecast relied on changes in unemployment, gross domestic product and inflation.

It noted that while the recession that is resulting from the coronavirus pandemic likely will be more severe than the GFC, it should be short-lived. As a result, property prices ought to bounce back relatively quickly. It expects prices to be down by just more than 25 percent in 2021 and by...





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Data Digest

 

CMBS DELINQUENCY VOLUME

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CMBS SPECIAL SERVICING VOLUME

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Top Bookrunners Domestic, Private-Label CMBS - 2017
Investment Bank #Deals Vol$mln MktShr%
Goldman Sachs 17.59 11,819.34 13.68
JPMorgan Securities 14.52 10,968.11 12.70
Citigroup 12.04 10,012.71 11.59
Wells Fargo Securities 14.02 9,936.06 11.50
Deutsche Bank 12.55 9,879.74 11.44

 

RCA CPPI

 

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CMBS 2.0 Spreads

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Top CMBS Loan Contributors - 2017
Lender #Loans Vol$mln MktShr%
Goldman Sachs 146.89 11,719.34 13.63
JPMorgan Chase Bank 117.68 10,114.14 11.76
Deutsche Bank 198.48 9,689.97 11.27
Morgan Stanley 166.18 8,539.78 9.93
Citigroup 199.05 8,088.24 9.41

 

 

 

REITCafe

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  • US REITs Feeling Effects from Turmoil in Greece and China
    International economic forces have taken center stage this week, affecting both US stock markets and REITs. The crash in the Chinese stock market and ongoing concerns about the future of Greece in the eurozone drove markets down during the first half of the week. REITs fared better than the overall market...

  • What Does Increased Construction Mean for Apartment REITs?
    REITs so far this year have raised $17.1 billion of capital through the sale of unsecured notes, bringing the total raised over the past two and a half years to just more than $75 billion. That’s more than they raised during the previous five years. The massive volume shouldn’t be a surprise as it comes while the yield from 10-year Treasury bonds, the benchmark...
shouldn’t be a surprise as it comes while the yield from 10-year Treasury bonds, the benchmark against which most REIT’s price their bonds
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