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| Weekly Interest Rate Tracking |
| July 15, 2008 |
Good Afternoon,
Attached is a PDF copy of Colliers Meredith & Grew's interest rate sheet that includes current and historical Treasury, LIBOR and Prime interest rates, which are updated daily with real time data from Strategic Alliance Mortgage.
We provide these updates on a weekly basis to keep our clients and colleagues aware of rate movements. We hope you find this information helpful.
DOWNLOAD INTEREST RATE SHEET (104KB)
The following Market Perspective provides insights and commentary on breaking news and emerging trends in commercial real estate finance.
- Drudge Report/AP: "President Bush called on Congress to move quickly to put into force legislation designed to help prop up mortgage giants Fannie Mae and Freddie Mac."
- Federal Reserve Statement: "There are significant downside risks to the outlook for growth and upside risks to the inflation outlook have intensified."
- The dollar fell to $1.6038 per euro this morning, the lowest since the euro's inception in 1999, while gold rose to a four-month peak and oil approached recent record highs after the Fed "signaled policy makers are unclear about the direction of interest rates because the risks to both growth and inflation have increased," according to Bloomberg. (Source: Bloomberg & Financial Times)
- Bloomberg: "Fannie Mae and Freddie Mac had their bank financial strength and preferred stock ratings cut by Moody's Investors Service. The senior and subordinated debt ratings were affirmed, according to a statement today by the New York-based ratings company. The financial strength ratings for each company were cut to
B-, while the preferred stock ratings were lowered to A1 from Aa3. Both remain under review for further downgrades."
- On Sunday, the Fed announced a plan to backstop mortgage lenders Fannie Mae and Freddie Mac after shares of these government-sponsored enterprises declined by almost 50% last week amidst bankruptcy rumors. The Fed's proposal raised Fannie and Freddie's line of credit from $2.25 billion to $300 billion and included a proposal for Congress to give Treasury the authority to buy shares in the companies, if needed. The Fed, meanwhile, would make its discount lending window available to the pair if necessary. (Source: RealClearPolitics & Slate/Washington Post)
- Associated Press: "The economy showed the depth of its twin problems on Tuesday, slow growth and rising inflation, as the nation wrestled with a teetering financial system, a slumping dollar and rising prices for food and fuel.The Labor Department reported that soaring costs for gasoline and food pushed inflation at the wholesale level up by a bigger-than-expected 1.8 percent in June, leaving inflation rising over the past year at the fastest pace in more than a quarter-century. Over the past 12 months, wholesale prices are up 9.2 percent, the largest year-over-year surge since June 1981, another period when soaring energy costs were giving the country inflation pains."
- Colliers Meredith & Grew: The most active (commercial real estate) capital providers continue to be life companies and local/regional commercial banks. Conservative underwriting standards (lower loan-to-value ratios of sub-65%, higher going-in cap rates, and the return of at least partial guarantees) remain the norm industry-wide. The few conduit lenders that have shored up their balance sheets and re-entered the market are, for the most part, significantly wider on pricing at this time.
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| Please contact the Capital Markets Group at Colliers Meredith & Grew with any financing questions.
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Colliers Meredith & Grew is a Boston-based commercial real estate company with integrated service groups including Brokerage, Capital Markets, Counseling & Valuation, Development & Advisory, Investment Sales, and Property & Asset Management. In addition to representing its core clients in New England, Colliers Meredith & Grew provides national and international real estate services to its multi-market clients as a member of Colliers International and as an owner/member of Strategic Alliance Mortgage LLC (SAM). Colliers International is a worldwide affiliation of independently owned and operated companies in more than 290 offices in 61 countries. |
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