NYC Landlords That Can’t Find Buyers Turn to Borrowing Instead
There is no bubble.
“‘Owners are pulling out capital’ by refinancing loans instead of finding buyers, he said.”
There Is No Bubble.
“Across the U.S., sales of office towers, apartment buildings, hotels and shopping centers have been plunging since reaching $262 billion nationally in 2015, just behind the record $311 billion of real estate that changed hands in 2007, according to Real Capital. Property investors are on the sidelines amid concern that rising interest rates will hurt values that have jumped as much as 85 percent in big cities like New York, compounded by overbuilding and a pullback of the foreign capital that helped power the recent property boom.”
There is no bubble and no need for regulations on the supply-side of real estate. The market will work this out.
“Even as buyers balk, lenders are writing loans large enough for owners to pay off existing debt and keep something extra for themselves, he said.
“Typically, a lender would rather see excess cash put back into the building for renovations and maintenance, rather than into the landlord’s pocket, Levy said. But given how competitive the lending landscape has become, it’s now easier for borrowers to negotiate more-favorable terms.”
Just stick your fingers in your ears and go “La La La La” and everything will be ok.
At a time when commercial-property purchases have slowed to a trickle, Manhattan landlords who can’t sell are still getting money out of their buildings — by turning to lenders.
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