Commercial Mortgages Transform – Jan 2015 update

Many commercial lenders have effectively (if not actually) shut their doors. For the rest of us, the resulting volume is so great our appraisal and processing systems are stressed to the limit. Several of our competitors are not even taking any more loans just to get through the current overload in their systems. We have chosen to push through the current avalanche of loans, and will continuing to entertain your new loan requests – all while trying to keep our rates very competitive.

What has changed (at least for now, and especially on larger loans) is our desire to only look at solid apartment and commercial properties, with borrowers that add to the overall strength of the loan. To lessen our processing overload, we have temporarily "closed the tap" on hotels/motels, gas stations, owner/user properties, environmental issue properties, "poor-credit" borrowers, etc. This is intended to help "unclog" the backlog so that your more traditional loans will go through faster.

For loans $3,000,000 and above, we are going to be strictly looking for traditional properties, nothing exotic, no stories, issues, or moving parts. Policy DSCRs and LTVs will be strictly adhered to. Borrowers will need to have average credit scores of 680 or better, their adjusted net worth must be 150% or greater than the loan amount, personal debt ratios cannot exceed 40%, etc.

Loans under $3,000,000 have more flexibility in all these areas. The range of acceptable product types is greater, we will look at a wider range of borrower credit and issues, and we can look at offsetting strengths and weakness (where we will not in larger loans).

Debt Service Coverage Ratios are on the rise as we see the economy weaken… 1.20 ratios for residential and 1.25 (or higher) ratios for commercial for the time being…

Though I'm not sure for how much longer… we are still offering to lock your loan, for up to 90 days, at no cost to your borrower.

And yes, we still offer you 1/2% rebate pricing – up to $15,000.00 per transaction.
I have enclosed our latest rate sheet for your review, and I will be happy to discuss your next transaction. On loans over $3,000,000 I will want to see reliable borrower financial data along with your submission – but feel free to call to discuss the transaction even if you do not have "everything" in hand.

For the short term, loans can be expected to take 60-90 days to close. We cannot handle any "rush" transactions for at least the next 60 days. Please let your borrowers all know to structure sales with longer closing dates!! If you have a 1031 exchange, make sure all parties can live with the reality of these closing times. The shortage of quality lenders with good rates, and the uncertainty of the market, will pass and the market will settle. Until then, we will try hard to meet your financing needs. My best wishes to you for the New Year!

Rome airport transportation: the strike of Rome’s taxis

Italian Taxi drivers renewed the strike in the middle of July 2006 after talks over government plans to deregulate the sector ,causing chaos in many cities.

The drivers staged various forms of protests, besieging main squares, deliberately snarling traffic, blocking access to several airports and organizing go-slow drives, local media reported.

In Rome, the drivers descended on central Piazza Venezia, the city center of Rome, soon after midnight after taxi unions abandoned the negotiating table.

They remained there throughout the night and forced local authorities to close the square off to traffic.

Some 60 other taxis took part in a go-slow drive from the city’s main airport to the city and back again, causing further problems.

The protests were replicated in Naples, Turin, Genoa and Milan, where drivers blocked access to the city airport.

Italian Economic Development Minister who drew up the bill contested by the drivers, said that “they (the taxi drivers) do not own the city.”

The matter of controversy is a government decree that intends to liberalize taxi licensing and break the virtual monopoly status of local taxi federations.

This decree orders municipal administrations to increase the number of taxi licenses issued and give out temporary permits during predictably busy periods.

One of the most controversial aspects is a measure which would have allowed private firms to enter the sector by acquiring licenses and then hiring their own drivers.

Taxi licenses in Rome are regarded as private property by their holders, who trade them on when they retire or pass them on to their children. The practice has created a grey market in which the cost of a permit can reach as high as 200,000 euros (about 240,000 U.S. dollars).

Italy’s 40,000-strong fleet of taxis is the smallest in Europe. According to official statistics, there are 2.1 taxis per thousand inhabitants in Rome compared to 8.3 in London and 9.9 in Barcellona.

The number of taxis operating in Rome is 5,820, compared to more than 61,000 in London, almost 43,000 in New York and 17,000 in Paris, the report said.

Complaints from residents and tourists over the difficulty in finding taxis during peak hours and at night have shot up in recent years, with taxi drivers accused of deliberately restricting the number of cars available in order to safeguard their earnings and the values of their licenses.