Soundview Insights

The Fed has confirmed that they will accelerate the tapering of their bond purchases so they will be down to zero by March 2022. This reduction in liquidity may raise the prospect of treasury yield increases, which may eventually push lenders to raise loan interest rates. Some loan officers have expressed concern already that they expect their firms to raise their interest rates soon. On the other hand, lenders are now lending for 2022 and many now have new lending and/or operational capacity to accommodate new loans.

Soundview is working with a private construction lender offering single-family vertical construction loans that do not require personal recourse. The program provides:

• $2 to $100+ million loan amounts
• Up to 85% LTC and 70% LTV
• Interest rates in the low 7% range
• No requirement for pre-sales (thus providing a better alignment of sales with costs)
• Dramatically reduced administrative burden for monthly draws and periodic reporting
• Far less restrictive financial covenants than those required by banks
• A&D loans are also available

Although the program interest rates are higher than banks', the lack of restrictions can allow the builder to increase profits while also better managing personal financial risk.

Best wishes for a Happy and Healthy New Year!

BOMA (Building Owners and Managers Association) International recently published Deep Dive No. 7, which includes a video and PDF, all with insights from top property professionals as they look toward the future.

Though the pandemic isn't over, there is hope in the knowledge that we are more prepared for those drastic shifts that were largely unprecedented in 2020 and early 2021.

Upon analysis and discussion, property professionals continue to rank staffing concerns (as well as talent shortages and workforce development) as their top issue. Many firms are moving toward more active methods of networking and recruiting, versus just posting the job online and praying for some high-quality candidates.

Here are some additional insights shared in Deep Dive No. 7:

• National leasing activity in the first three quarters of 2021 is up 19%
• Tenants value transparency: the long months of facing the unknown throughout the pandemic have highlighted the need for tenant education and proactive communication
• Few operations plan on downsizing their physical spaces: instead, they are focusing on hybrid work solutions and increasing flexibility within those spaces.

For more on these and other insights, check out the link below.

The pandemic influenced 25% of renter moves over the past 18 months, according to the National Multifamily Housing Council and Grace Hill 2022 Renter Preferences Survey Report.

That 25% of renters who moved cited shifts in remote work as their primary reason for relocating.

Flexibility is a big draw, too. 46% of those surveyed said they would consider joining a rental housing membership program that would allow members to move between communities within a network of properties, similar to how vacation club memberships work.

Having exceptional internet is also a top renter preference because more people are accessing rich media sources like streaming music and video, video conferencing, and gaming.

Conversely, renters are less likely to rent in a space that has pet or pet breed restrictions.

For more on renter preferences, click the link below.