The MBA CREF / Multifamily Housing Convention & Expo was held in San Diego on February 11 to 14, 2018, and it was well attended. There were many interesting sessions and breakouts. Here are some of the takeaways:
- All presenters had positive outlooks on the economy. There were, however, differences of opinion about where commercial real estate is currently positioned in the cycle: some believe we are in the latter stage of the cycle while other said that there is no end in sight.
- Several banking executives mentioned the increased competition from non-banks, which are, on occasion, offering more favorable terms.
- Several speakers said that the Federal Open Markets Committee will likely raise the Federal Funds Rate three times this year.
- Multi-family and office lending is being highly scrutinized because of oversupply in many markets. Some presenters mentioned that rental growth for both property types is sluggish. However, office construction lending continues at a good pace for build-to-suits.
- Banks approach to retail is varied: some are only lending to national chains that guarantee local rental payments. In response to a question about store closings, one panelist said they create, in some circumstances, opportunities for attracting better tenants.
- All banks are expanding their lending for industrial properties for both refinancing and construction. E-commerce has made industrial the property type with the strongest fundamentals.
