Commercial Private Mortgage Debt Loans

[Joel Owens]

I was wondering what rates private debt lenders were wanting on value add commercial deals??

I am seeing right now that banks or even hard money lenders want 35% down from purchase regardless of current value.

So for example if you bought a strip center at Auction for 800,000 the HML lenders want 35% down of that 280,000. It doesn't matter that in it's as-is state it could be worth 1,100,000 and stabilized ARV is close to 2 million.

I am told the banks were burned during the last downturn and now want to put onerous terms on borrowers even with HML money. The difference being the banks made those loans at a peak market and now some assets are just recovering so the same risk is not there. The lenders are still behind in the times and thinking of 2008 which has nothing to do with this cycle for this asset class.

It seems if a private lender could get 8 to 10 percent on their money that would be a great return.