Expects Momentum to Build in First Half of 2017 as Investors Seek to Lock Favorable Rates
Largest Independent Commercial Mortgage Bank in Western United States Exceeds $2 Billion in Annual Production for Fifth Year in a Row; Sees More Than 55 Percent of 2016 Loan Production in Multifamily and Retail Asset Classes
SAN FRANCISCO–Newmark™, the largest independent commercial mortgage banking firm in the western U.S., closed more than $2.4 billion of commercial loans while exceeding $9 billion in loan servicing during 2016 on its existing portfolio for the first time in company history. This is the fifth consecutive year that Newmark has surpassed $2 billion in annual loan production. The company expects to see similar volume in the year to come as investors seek to lock favorable interest rates anticipating a measured yet continued rise throughout 2017 and beyond.
“We saw a significant number of property owners seeking to lock in long-term and construction financing solutions at historically lower rates, with 269 unique transactions in 2016,” said Michael Heagerty, principal and CFO with Newmark. “Roughly 55 percent of these transactions were in the multifamily and retail asset classes, with self-storage assets also having a strong year with our portfolio lenders. Overall, interest rates are rising, and we expect to see healthy demand in the first half of 2017 from investors in each of our regions seeking to secure financing before they miss the window of relatively low historic rates.”
Commercial real estate finance trend areas highlighted by Newmark’s principals as relevant for consideration moving from 2016 to 2017 include:
- Interest Rates: Rising interest rate climate demands attention from owners/investors in 2017.
- Multifamily: Financing demand for new construction, acquisition and recapitalization in the multifamily sector will remain robust.
- Retail: Expect to see continued interest in recapitalizing existing assets to lock in current rates.
- Self Storage: Self storage has emerged as a new asset class of interest to a growing number of institutional lenders.
- CMBS: CMBS transactions were down significantly in 2016; and will remain so in 2017 unless properly structured.
Newmark also begins its 25th year of operations moving into 2017. Since its founding, Newmark has placed more than $30 billion of commercial mortgages across 3,500 unique transactions covering the spectrum of commercial real estate asset classes including office, industrial, retail, multifamily, mixed use, hospitality, self storage and mobile home parks. The Newmark brand today represents more than 20 institutional lenders as their direct correspondent and servicing agent, and worked with nearly 90 unique capital sources in 2016. Newmark operates from production offices in eight locations: San Francisco and Sacramento in Northern California; Los Angeles and Newport Beach in Southern California; Seattle and Spokane in Washington State; Las Vegas, Nevada; and Phoenix, Arizona.
Newmark is a full service independent mortgage banking firm offering realty capital solutions through an extensive lineup of correspondent lenders utilizing Newmark’s production, closing and servicing capabilities. Established in December 1991, Newmark is currently staffed by more than 60 employees in regional offices throughout the western United States. The company services a commercial portfolio of approximately $9 billion representing over 1,200 loans. Newmark is rated as a Primary Servicer by Standard and Poor’s and is one of a select few non-banking/non-insurance chartered companies with this designation. For more information please visit www.newmarkrealtycapital.com.
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