Robust job growth, a surge in gross domestic product growth to 4.2% in Q2 and favorable regulatory and tax policies have resulted in strong commercial real estate (CRE) fundamentals as of late, discussed New York-based property exert and consultant Jacob Frydman, “2018 has been the strongest year of economic growth this cycle, with sales transactions up to $236 billion in the first half of 2018, up 4% compared to 2017, which was a record year.” With interest in CRE is at an all-time high, Frydman laid out several financing options for individuals seeking to purchase their first commercial property. Just as with home mortgages, banks and independent lenders are actively involved in commercial real estate, said Jacob Frydman. Insurance companies, pension funds, private investors and other sources, including the U.S. Small Business Administration’s 504 Loan program, also commonly provide capital. In contrast to residential mortgages, which are typically made to individual borrowers, CRE loans are often made to business entities (corporations, developers, limited partnerships, funds, trusts, etc.). An entity is not required to have a financial track record or any credit rating, however the lender may require the principals or owners to provide a guarantee, or an individual or group with a credit history from whom they can recover in the event of default. If this stipulation is not required, and the property is the only means of recovery, the debt is called a non-recourse loan, meaning that the lender has no recourse against anyone or anything other than the real estate.
Real estate expert Jacob Frydman is a frequent guest on Fox News, Bloomberg TV, CNBC and other television news outlets. Over the span of his 30-year career, Frydman has acquired more than 5 million feet of real estate, valued at over $2 billion of investment. Notable transactions include the Global Crossing New York Headquarters, the Aetna Building, NBC Television Studios and Two Dag Hammarskjold Plaza.
Jacob Frydman – CEO & Chairman – United Realty Advisors, LP – LinkedIn: https://www.linkedin.com/in/jacobfrydman
Jacob Frydman – Huffington Post: http://www.huffingtonpost.com/author/jacob-frydman