|
| Weekly Interest Rate Tracking |
| July 8, 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 (105KB)
The following Market Perspective provides insights and commentary on breaking news and emerging trends in commercial real estate finance.
- News Monday that Fannie Mae and Freddie Mac may need to raise as much as $75 billion as new accounting rules require them to bring off-balance sheet mortgages on to their books triggered a 23 bp surge this morning in the cost of credit-default swaps on the Markit iTraxx Crossover index of 50 companies with mostly high-risk, high-yield debt ratings to 560, the highest since March 31, according to Bloomberg.com. However, comments this afternoon by analysts and regulators that the companies were likely to be exempt from the changes eased concerns about the companies' need to raise new capital, according to MarketWatch.
- The Fed may extend its emergency credit facility program for Wall Street banks into 2009 as long as emergency conditions "continue to prevail," according to The Wall Street Journal.
- Real Estate Alert has reported that "with high levels of debt no longer available, developers have to line up more equity for projects." Additionally, with leverage levels holding steady in the 60%-65% LTV/LTC range, we have seen mezzanine lenders increasingly pursue opportunities to fund borrowers further up the capital stack (70%-85% LTV/LTC).
- Treasuries maturing in five years or more rose as commodities tumbled for a third day, easing concern that inflation will accelerate and erode the value of bonds' fixed payments, according to Bloomberg.com.
To illustrate the relationship that the value of the dollar has to oil, one OPEC chieftain was quoted as saying that each 1% drop in the dollar adds $4 to the price of a barrel of oil. MarketWatch reports that if the Fed were to remove some dollars from the global financial system, the buck would rise in value against the other currencies. Of course, this might boost interest rates as well, thus hurting some borrowers—especially those with adjustable-rate loans. But it could help others who borrow at a fixed rate, individuals as well as businesses, since less inflation would reduce long-term interest rates. So, while the dollar's value used to concern mainly importers and exporters and thus was not a big factor in setting monetary policy in the past, its foreign exchange value is far more crucial today.
- Financial Times has reported that the Securities and Exchange Commission has concluded that "credit rating agencies failed properly to manage conflicts of interest in assigning top ratings to bonds backed by subprime mortgages and other assets."
|
| Please contact the Capital Markets Group at Colliers Meredith & Grew with any financing questions.
|
|
|
|
|
|
Colliers Meredith & Grew respects your privacy. If you prefer to be removed from our distribution list, please click here to unsubscribe. A copy of our privacy policy can be found on our website.
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. |
|
