c/cre-financing

Burned by a floating rate loan on a strip mall near Akron last month

Locked into a 3 year term back in 2021 and now my rate jumped almost 200 basis points at renewal. Anyone else getting hit hard with these recasts and considering a swap or just riding it out?

The loan docs that took 3 months because of one missing comma

I was working on a small mixed-use deal in Austin last year, a 12-unit building with some retail on the ground floor. We thought the financing was all lined up with a local bank, just needed to get the paperwork signed and funded. But the legal team caught that the borrower's LLC name had a comma in it on the signature block, while the operating agreement didn't have one. The bank's underwriter said they couldn't budge, so we had to file an amendment with the secretary of state to add that comma. That one little thing took 11 weeks to process, and we almost lost the earnest money deposit. By the time the docs were ready, interest rates had shifted and we had to renegotiate the whole deal. Has anyone else had a tiny typo or formatting thing blow up a closing timeline like that?

Overheard a guy at the coffee shop say he locks rates 45 days out. Always did 30.

Was waiting for my drink yesterday morning and caught this older broker talking to someone about a deal he just closed. He said he never goes under 45 days on rate locks because the buffer saved him twice last year when closings got pushed. That got me thinking. I always did 30 days to save the tiny fee but now I wonder if I've been cutting it too close. Has anyone else switched to a longer lock period and seen fewer headaches?

Just hit a 7.5% cap rate on a small multifamily in Cleveland and I'm still trying to figure out if that's actually good or a red flag

On one hand the numbers look solid and the area's growing but on the other hand I keep wondering if I'm just getting paid for taking on hidden deferred maintenance or vacancy risk that I haven't spotted yet - anyone else hit a number that felt too good to be true and how did you verify it?

Why I stopped trusting automated valuation models after a deal fell through in Tacoma

I compared the AVM on a strip mall property against a broker's opinion of value last month and the AVM was off by 18%, missing a power line easement that kills future development. My lender almost let me overpay by $120k until I got smart and paid $500 for a real appraisal. Has anyone else seen big gaps between these tools?

Why does nobody talk about the difference between local credit unions and big banks for small CRE loans?

Honestly, I compared a $250k loan from Chase vs a local credit union in Cleveland for a small retail strip. The credit union approved in 3 weeks with 5.5% and the big bank dragged it out for 3 months then asked for more docs. Anyone else find better terms with smaller lenders on deals under $1M?

Just ditched my old way of underwriting multi-family deals

For years I looked at DSCR and cap rate first on every apartment deal that came across my desk. Figured if those numbers weren't there, nothing else mattered. Then last November a guy in Denver showed me his underwriting for a 12-unit property that barely hit a 1.15 DSCR. He talked about the local job growth, the fact rents were 15% below market, and a major infrastructure project breaking ground nearby. I ran the numbers his way on my next deal and it got me a loan that cash flowed from month one. Now I spend more time on the market story than the hard ratios. Anyone else shift their focus from pure math to location story?

I was dead wrong about small balance loans being a waste of time

Back in 2018 I thought anything under $500k was not worth the paperwork. Then a buddy pushed me to do a $350k deal on a duplex in Cleveland and the spread was actually better than my big stuff. Anyone else change their mind about a specific CRE strategy after giving it a shot?

Debate: Is it smarter to lock in a fixed rate now or float with SOFR for a multifamily deal?

I keep seeing people push fixed-rate CMBS loans for 5-year terms like it's the only safe play, but with SOFR still under 5%, floating seems way cheaper for a value-add property in Phoenix I'm looking at. Last month a lender quoted me SOFR+250 with a floor at 6%, while fixed was at 6.8%, and I estimate the spread could save me $15k a year if rates hold. Are you guys locking in for peace of mind or riding the floating wave and hoping the Fed cuts come through?

Checked out that new mixed-use project in Tempe and the loan terms they posted seem wild

They're advertising a 5-year fixed rate at 4.75% for a retail condo unit, but the fine print says it's only for the first $500k with a 25-year amortization. How is anyone supposed to make the numbers work on that with such a short term and low cap? What am I missing here, is this just a teaser rate to get people in the door?

Changed my mind about using a national lender for a small strip mall deal

I was set on a big bank for a $1.2M refi on a property in Tacoma, thinking they'd be solid. My broker pushed me toward a regional credit union instead, arguing they'd be more flexible on the DSCR. The credit union closed in 45 days and gave me a better rate by 25 basis points. Anyone else find local lenders are better for deals under $5M?

Tried to refi a strip mall with a local bank versus a CMBS lender last year

The local bank offered a 5.5% rate but wanted a 1.5 DSCR and a 20% holdback for tenant improvements. The CMBS loan came in at 6% but was non-recourse and had a 1.2 DSCR minimum. We went with the CMBS deal for a property in Tempe, and the flexibility on cash flow during a vacancy period saved us over $40,000 in the first eight months. Having that extra breathing room when a key tenant left was a total game changer. Has anyone else found that a slightly higher rate can be worth it for better loan terms?

Just hit a 95% occupancy rate on a property I almost walked away from

We closed on a small retail strip in Phoenix last year, and the first six months were brutal with two anchor tenants leaving. Our lender's debt service coverage ratio was getting tight, around 1.15. I pushed hard on local marketing and tenant fit-ups, and this month we hit 95% leased. That DSCR is now a solid 1.45, which totally changes the refinance picture we're looking at next quarter. Has anyone else had a turnaround like this that saved a deal from going sideways?

Can we talk about paying for a 'premium' market report?

I mean, I dropped $1,500 on one of those fancy reports for a multi-family deal in Austin I was looking at last quarter. The data looked great, but it was all stuff I could have pulled together myself from free sources in maybe a day. It basically just repackaged CoStar and census info with some pretty charts. I feel like a total chump for not checking the sources first. Has anyone else found a good, actually useful data source that doesn't cost an arm and a leg?

Question about a bridge loan that almost fell apart on a Phoenix retail strip center deal last month

The time a lender's 'quick chat' at a coffee shop in Boise turned into a full-blown spreadsheet review

He pulled out his laptop to show me a rate sheet and ended up walking me through his whole underwriting model for a strip mall deal... right there next to the pastry case. Ever since, I bring a printed one-page summary to any first meeting. How do you guys handle those first talks without getting bogged down?

I was wrong about the risk on office buildings in Atlanta

I read a report from JLL last week that said the vacancy rate for class A office space in Atlanta's central business district is over 25%. I always thought those top-tier buildings were a safe bet, but that number is way higher than I guessed. Has anyone else seen a local market stat that made you rethink a whole property type?

Showerthought: The spread on a 5-year fixed loan for a Phoenix office building went from 180 bps to 300 bps in a year.

I was looking at a deal from Q1 2023 and the same lender's quote today for a similar property. The rate jump is huge, but I'm split on the main cause. One side says it's just the Fed hikes and general market fear. The other argues it's more about Phoenix's specific office vacancy hitting 25% and lenders seeing way more risk there now. Which factor do you think is driving the bigger change in underwriting?

Finally got a small apartment deal to pencil out after six months of looking

I spent the last week crunching numbers on a 12-unit building in a mid-sized city, and the lender finally gave me a term sheet yesterday. The rate is a bit higher than I wanted, but the loan-to-value came in at 70%, which was the key. In my experience, getting that first real quote on a property you've been tracking feels like a win, even if it's not perfect. It makes all the spreadsheets and phone calls feel worth it. Has anyone else had a deal finally start to make sense after a long time looking?

That Phoenix deal taught me to always check the cap rate math myself

I was at a lender meeting for a strip mall in Phoenix last month, and the broker's packet showed a 7% cap rate. I ran the numbers after the meeting and found they'd used last year's full occupancy, not the current 85%. The real cap was closer to 5.8%. It completely changed how I look at every deal sheet now. Do you guys ever trust the pro forma numbers you're given first, or do you always rebuild them from scratch?

Bridge loan rates on a 20-unit property jumped from 6% to 8.5% in under a year

I closed on a value-add deal in Tampa last March with a bridge loan at 6%, but when I looked at refinancing options this month, the best quote I got was 8.5%. The lender pointed to the Fed hikes and tighter capital, but some folks say it's more about lender risk appetite now. Are you seeing this kind of spike in your markets, or is there a better play than a bridge loan right now?

Had to choose between a bridge loan and a full refinance for a 50-unit apartment deal in Austin last quarter. Went with the bridge.

I finally had to pick between a 5-year fixed and a 7-year fixed on a strip mall deal.

The 5-year was at 5.8% and the 7-year was at 6.1%, and I went with the shorter term thinking rates might drop for a refi. It's been 18 months and I'm already sweating the rate environment for when my term is up. Anyone else gamble on a shorter term recently and how's it looking for you?

Showerthought: my property tax bill made me see cap rates in a new way

I was looking at a small retail strip in Phoenix last Tuesday, and the seller's pro forma had a 7% cap rate. Then my own tax bill for a duplex came in, and the city raised the assessed value by 12% out of the blue. It hit me that the pro forma didn't budget for a tax hike like that, which would have crushed the actual net income. Now I run the numbers with a 2% annual tax increase baked in, and deals look different. Anyone else get burned by not modeling for tax jumps?

Vent: I got a rate quote from a local bank that was a full point lower than the big national lenders for a small retail strip I'm buying.

I mean, I almost went with a big name broker out of habit, but my attorney in Grand Rapids said to check with a couple regional banks, and one came back at 6.25% for a 5-year term on a $1.2M note, which saved me a ton, so maybe it's just me but has anyone else had better luck with smaller lenders lately?