Today’s show is with guest Sean Burton, Chief Executive Officer of Cityview, a seasoned institutional private equity professional in multifamily real estate. Sean shares insights gained from over 20 years running Cityview that have spanned the Great Financial Crisis of 2008+ and the lessons he learned successfully navigating that downturn. I reached out to Sean to ask him to guide me through an article he wrote, ‘Multifamily Reckoning: Repricing Risk Amid Higher Interest Rates’, one of the...

In today's commercial real estate news update with guest Dave Saxe of Calvera partners, we cover these topics and articles: Today’s news from the Federal Reserve - more rate hikes to come. https://www.reuters.com/markets/us/fed-registers-gains-powell-may-take-lay-low-approach-2023-08-25/ https://apnews.com/article/inflation-federal-reserve-rates-economy-jackson-hole-9a720711618c0cfd851b51b0786af4f0 ...

Today’s show is with guest Henry Lorber, distressed real estate debt expert and one of the only people you will likely come across whose experience goes back so far he remembers the REIT downturn of the 1970’s! I contacted Henry because he was quoted as saying that ‘Crowdfunding for real estate is a disaster waiting to happen’ in a recent Real Deal article (see link at the bottom of the page) and, rising to the bait, I figured such a statement could not go unchallenged. Apart from our...

Each week I look at three of the top stories dominating the news, this week with my regular guest, Dave Saxe of Calvera Partners and I cover: 1. Increasing talk of the impact of rate hikes on multifamily https://www.bisnow.com/national/news/multifamily/multifamily-market-approaches-hydrogen-bomb-scenario-as-cmbs-loans-come-due-120119 https://www.cityview.com/urban-land-multifamily-reckoning-repricing-risk-amid-higher-interest-rates/ 2. More consolidation from the world of real estate...

Everything's sellable. In today’s market, it's just a question whether seller expectations are reasonable. My guest today, Jon Winick, CEO of Clark Street Capital a bank advisory and asset disposition firm specializing in loan sales, both performing and non-performing, explains how elevated interest rates are posing challenges for banks on how their loan portfolios are sold. As defaults rise and a potential banking crisis looms, a hurdle the industry faces is in balancing appraised values...

Tune in to hear updates and commentary from Adam Gower Ph.D., GowerCrowd, and David Saxe, Calvera Partners, about the major news stories this past week (week ending August 11, 2023) in the commercial real estate industry: Stories we cover today: 1. Urban doom loop. 2. New deals on offer at 24% IRR's - you've got to be kidding! 3. Even multifamily is facing peril Articles we refer to: ...

Tune in to hear updates and commentary from Adam Gower Ph.D., GowerCrowd, and David Saxe, Calvera Partners, about the major news stories this past week (week ending August 4, 2023) in the commercial real estate industry: Stories we cover today: Has the world really changed? If people never again shop in malls or work in offices the way they did before the pandemic, how safe are the fortunes they piled into bricks and mortar? Reference...

The real estate market is witnessing a shift where many stakeholders are grappling with the changing dynamics. One of the significant concerns is the valuation of properties. Many banks are hesitant to offload their real estate collateralized non-performing loans (NPL) due to uncertainties in their values. This uncertainty is causing a delay in the stabilization of the bid-ask spread, with some predicting stabilization won’t come much before 2025. Office spaces are undergoing a...

Tune in to hear updates and commentary from Adam Gower Ph.D., GowerCrowd, and David Saxe, Calvera Partners, about the major news stories his past week (week ending July 28, 2023) in the commercial real estate industry: More rate hikes - is this the new normal? CRE distress is increasing with no let up in sight. Why single family home values aren't tanking.  Stories we cover today: https://commercialobserver.com/2023/07/cre-loan-distress-up-70-of-largest-metro-areas-in-june/ ...

"It's not the most upbeat environment right now even though there is a lot of capital out there." As a consequence of ongoing real estate distress and related tightening of capital markets, many sponsors are facing refinancing hurdles, especially if their initial plans lacked sufficient reserves to weather economic storms. Alarmingly, by the end of 2025, we're looking at a maturing commercial mortgage debt of approximately $1.3 trillion. From 2025 to 2027, another almost $1.2 trillion is on...

Tune in to hear updates and commentary from Adam Gower Ph.D., GowerCrowd, and David Saxe, Calvera Partners, about the major news stories his past week (week ending July 21, 2023) in the commercial real estate industry: latest news on the CrowdStreet/Nightingale story and the lessons learned for investors. The real agenda behind regulators' continued encouragement to banks that they accommodate struggling borrowers with loan extensions and other means of prolonging their credit. How eviction...

In this episode of The Real Estate Reality Show, I sit down with David Scherer, Co-Founder and Co-CEO at Origin Investments to discuss the company’s rent trend predictive tool, Multilytics.   Multilytics is a machine learning game changer for Origin because it gives them accurate (with 95% confidence) down-to-the-building rent trend predictions.   Nothing with the same degree of reliability exists in the industry and David shares the story of why Origin built it, how they built it,...

Join me, your host Adam Gower, and Dave Saxe of Calvera Partners as we discuss the week's news  for week ending July 14, 2023. Main highlights are: Impact of regulators letting banks know they are greenlit to 'extend and pretend'. What's going on with inflation? Is the fight over?! Why it might not be a good idea for a multifamily sponsor to getting into a p*ssing match with The Real Deal. The Real Deal Article we refer to is here.

During times of distress in commercial real estate markets, one sector of the industry grows as values tumble: The receivers.   My guest today, Mitch Vanneman, Vice President at Hilco Real Estate, is a professional receiver and in today’s discussion he explains what receivers are, what they do, and how they help bridge the gap between lenders and borrowers when deals go bad.   Key insights from this episode include:   The impact of loan maturities: These are set to cause...

"Higher interest rates beget higher capitalization rates. As cap rates go up, property values necessarily decline."   This quote encapsulates the current state of the real estate market and is a consistent theme in my conversation with Orest Mandzy, Managing Editor at Commercial Real Estate Direct. It's a simple yet profound statement that underlines the interconnectedness of interest rates, capitalization rates, and property values. When interest rates rise, it leads to an increase in...

In recent times, the commercial real estate market has seen a surge of new investors and sponsors, many of whom are experiencing the realities of a real estate downturn for the first time. As interest rates rise and operational distress becomes more prevalent, the industry faces significant challenges.   Our guest on The Real Estate Reality Show today, Steve Moore, a seasoned expert from Causeway Advisors, LLC, discusses the impact of these changes on both developers and their investors. ...

In the current chilly climate of the commercial real estate market, it's not just about distress but also about understanding the nuances of the market. In this episode, I sit down with Yardi Matrix's Research Editorial Director Paul Fiorilla to discuss the impact of various factors on the market, particularly in the realm of distressed assets. A brief look at some of the insights you can expect in this week's episode: Current concerns are largely driven by the rising interest rates and...

In the past five years, there has been an unprecedented wave of new commercial real estate syndicators entering the market with a similar wave of accredited investors new to the industry following in their wake. But as interest rates rise and lending standards tighten, the commercial real estate industry is facing significant challenges and these newcomers to the industry, both sponsors and (passive, accredited) investors are now, for the first time, dealing with the realities of what...

“When you have free money, people do stupid things. When you have free money for 11 years, people do really stupid things.” So sayeth billionaire, Stan Druckenmiller.  Now that interest rates are rising and there is no more free money and combined with tightening lending standards, it is becoming more difficult for developers to secure financing for new projects or to refinance existing loans.  And with $500+ billion of CRE loans coming to maturity in the months to mid-2024, you’re going to...

Bull markets are driven by greed. Bear markets are driven by fear, and it is peak fear right now.   In the latest episode of The Real Estate Reality Show, my guest, Max Sharkansky, principal at Trion Properties discusses why fear is making it difficult to find liquidity or to transact in the current market despite solid fundamentals (in multifamily) such as increasing rents and occupancy.   Here are some highlights from Max:   Driving this fear is the perception that interest...

Commercial real estate sponsors who took out floating rate loans are in trouble. Rates have over doubled since their lows throwing many loans into technical defaults even if the borrower is keeping them current and their lenders aren’t (yet) marking them to market. What this means is that many sponsors, especially those new to the real estate game (i.e. who entered during the bull run of the last 11 years), if they have not done so yet, are likely to stop distributions to their investors...

There are three simple rules to success when investing in real estate today, Wait, Pass, and Sprint. There is a vast portfolio of heavily discounted distressed commercial real estate deals under the surface, hidden from view and moving towards making their debut on the market on heavily discounted terms either through foreclosure, note sale, rescue capital, or litigation. Inexperienced sponsors who have built large portfolios quickly in the last few years are panicking, figuring out how to...

When a real estate deal goes bad as many are doing now, should limited partners have the right of first refusal to invest rescue capital on the same terms as anything the sponsor can bring in to save the deal? My podcast guest today, attorney Mark Roderick, calls it ‘pre-emptive rights’ and, as you will hear, he explains it can make the best of a bad situation. But what does that look like in reality? Here’s the script: *** Email #1: From Sponsor to Limited Partners (Investors): Subject...

Have you lost a real estate deal because debt costs skyrocketed and the banks stopped financing your construction project?  Eric Brody, my guest today has but he has pulled himself up by his bootstraps and now helps others out of similar, sticky situations.  His new venture, ANAX, provides much-needed capital to distressed real estate projects in various stages of completion.  He shares his personal story of being at the wrong end of a distressed development deal, the lessons he learned,...

In this first guest episode of Series 5 of the GowerCrowd.com podcast, The Real Estate Reality Show, you're going to be meeting with David Saxe. David has lived through prior real estate downturns at major institutional commercial real estate companies. He discusses how distress is filtering its way into the CRE investing world and we look at the impact of rising interest rates on cap rates, asset values, and how this is leading to an increased flow of distressed opportunities across all...