Tuesday, March 24, 2009

How to Find Conventional and Alternative Real Estate Funding Opportunities? - It's Still Out There, You Just Need to Know Where to Look!!!!!

Where do you find available funding for your commercial and residential real estate development project financing needs? Who is lending on real estate with the credit markets frozen up? Where are reliable capital sources you can rely on particularly if you are ready to lose your current real estate development project because you cannot debt service it anymore or you are acquiring land “pennies on the dollar,” however, you cannot find the right real estate funding source because they are not investing in real estate opportunities? Where do you turn if your funding source is no longer available or they will not be available for another 90 to 180 days?

The real estate bust has many commercial and residential real estate developers and builders scrambling searching for viable funding options to meet their debt servicing needs that are about to mature on current projects that are owned or opportunistic acquisitions of commercial and residential development projects in which real estate companies are acquiring at “pennies on the dollar” through real estate-owned projects of banks or institutions who in the past invested heavily in acquisition, development and construction lending for commercial or residential related projects or other capital sources or providers such as hard-money lenders, hedge funds, private equity, mezzanine, and joint venture partnerships. Idealistically, valuations have played a key role in the demise of commercial and residential companies as a going-concern because of the lack of financing to fuel their appetite to continue to develop and construct their project which chances are were acquired at higher values and injected with higher construction costs of labor and materials during the hay-days of the real estate boom. On the other hand, the collapse of the real estate market has brought opportunities to acquire, develop and construct commercial and residential projects at a costs basis, not seen since the late 1970s to early 1980s. Combining a lower land basis for acquisition on land with lower direct and indirect development and construction costs, provides a tremendous opportunity to “pencil” a commercial and residential developer’s end-state in today’s market environment. That is, whether a lower lease opportunity in the commercial arena for big box tenants or a small to medium size business in a Class A building or an affordable housing opportunity for a homebuyer, commercial and residential real estate companies can re-set their business model at attractive rates and pricing of their products.

The underlying issues for both situations has been access to capital providers who have access to the appropriate conventional and alternative funding a commercial or residential real estate company is searching. In today’s market, finding a centralized funding environment is key to the success of commercial and residential development companies. The days of “word of mouth” are slim to say the least. Many of those capital funding providers have also gone belly-up like many real esate development companies because of the past real estate investments that were made by those funding sources. Today, time is of the essence for real estate developers to identify key sources.

Commercial and residential real estate developers, homebuilder, or real estate investor seeking conventional financing or alternative “out-of-the-box” financing to capitalize challenging real estate projects particularly in today’s market can join professional networking group such as Global Capital Sources for Conventional and Alternative Real Estate Funding/Financing on LinkedIn.com who share the same interest and passion such as the real estate market. Here at Global Capital Sources for Conventional and Alternative Real Estate Funding/Financing, commercial and residential real estate companies can find a multiplicity of capital providers who have access to conventional lending programs ranging from institutional and banking, hardmoney, and mezzanine to alternative funding including venture capital, private equity, offshore funding, humanitarian funding, credit enhancements, structured investment vehicles, sovereign wealth funds, alternative-centric financing, collateral funding such as Medium Term Notes, Stand-by Letters of Credits, Bank Guarantees, Corporate, Municipal and Junk Bonds, CDs, Life Insurance Wraps, Collateralized Debt Obligations and Mortgage Backed Securities, trade platforms with proven traders from Europe, Middle East, Asia, South America and the US, investment banks, hedge funds, joint ventures and top 100 of the world’s largest banking partners. No forum exists such as Global Capital Sources for Conventional and Alternative Real Estate Funding/Financing group on LinkedIn.com in the global real estate market where you will find at your fingers tips access to thousands of individuals who can provide funding solutions for your commercial and residential real estate development funding needs like this group. With the capital markets stalled with the credit crunch, finding real estate funding opportunities can be a challenging search. By bringing together real estate developers and capital funding and financing providers together in this centralized forum, the probabilities of successfully closing a real estate transaction in today’s environment is extremely high because the real estate funding need of a real estate developer is aligned with a capital funding & financing source that has direct access to available capital.

Joining the Global Capital Sources for Conventional and Alternative Real Estate Funding/Financing group on LinkedIn.com is free to register. Bring yourself closer to accessing capital providers who have immediate access to your real estate funding needs.

Reported By:

Rod Fermin

LCI Communities

4 comments:

  1. While access is certainly important the real underlying issue for almost all potential real estate funding situations these days is valuation. This is especially true in residential projects but is rapidly becoming a greater issue in commercial as delinquency and default rates start to ramp up there too.

    The real problem is that in a market that is virtually stalled there is no competent mechanism for valuing the asset backing the loan. This problem then gets compounded because financiers, regardless of the source, must mitigate their risk by lending at extremely low loan to value in order to hedge against further value declines - if they are willing to lend at all.

    One of the best approaches in this market is work with a local or regional source that knows their markets well and will likely be more comfortable valuing those assets.

    Robert Purnell, Managing Director
    Shepherd Capital Partners

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  2. Hi,
    I’m very glad to find a blog like this which provides the information about lot of things regarding Real Estate Funding Opportunity which I was unaware of. The way you have explained was very informative. I can sure you that whoever will go through the Real Estate Funding & Financing Providers will definitely gain a lot of knowledge regarding how & where to look for real estate funding & financing. I would like to say that I am a regular blogger and generally search online to find such kind of informative blogs which pertains good amount of knowledge to the readers. While surfing I came across some other blogs having such kind of information shared, which I will share here later.

    Thanks

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