February 24, 2021
Prime Rate
3.25%
0.12%
1.42%
1.50%

Capital Markets Update - January 2021

As we all begin a new (and hopefully better) year in 2021, the team at Essex is keeping its eye on several important trends in the commercial mortgage markets that we’ve identified after having conversations with lenders and marketing a variety of new loan requests. Some of these trends are a continuation from what we saw in the second half of 2020, but others reflect the patient approach of lenders to the economic recovery.  Multifamily and industrial loans continue to be in high demand, with lenders offering the lowest rates and best terms for these property types. While rates have increased slightly from late 2020 lows, it is not uncommon for interest ra...

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Essex and PGIM Real Estate finalize correspondent relationship to source Fannie Mae and Freddie Mac loans

Denver, January 4, 2021 – Essex Financial Group (“Essex”) has formed an exclusive correspondent relationship with PGIM Real Estate to source loans intended for sale to Fannie Mae and Freddie Mac. With this relationship, Essex will work with PGIM Real Estate’s origination team in the Rocky Mountain region and have access to their DUS and Optigo lending platforms. PGIM Real Estate is one of the only lenders to hold DUS and Optigo licenses that is not a bank or a brokerage company and is one of the top agency lending platforms in the country. In 2019, PGIM Real Estate originated $2.1 billion on behalf of Freddie Mac and $5.0 billion on behalf of Fannie Mae, making the fir...

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Essex December Loan Closings

Essex is happy to announce a strong finish to a very difficult year. In the month of December 2020, Essex Financial Group closed five (5) transactions totaling $107 million. All five properties were located in the Denver-Boulder MSA and included both industrial and office properties. The closings featured insurance company and CMBS executions. One of the transactions was a non-recourse bridge loan from a life insurance company, a space where more and more insurance companies are trying to compete. We are encouraged by this activity in the capital markets and will continue being optimistic as we ring in the New Year. We would like to wish everyone a happy an...

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Potential CRE Tax Implications for 2021

As the presidential election appears to be concluded, commercial real estate investors are now strategizing for the future impacts of new taxation policies under a different administration. It is worth prefacing this article with the fact that these changes / proposals are all preliminary at this point, as there are many factors that will ultimately determine whether or not these become a reality. That being said, it can greatly benefit investors to be proactive in re-evaluating their investment strategies under increased taxation policies.There are three primary proposed changes to the tax law that would affect CRE investors:Raising capital gains from 20% to ordinary...

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The Menu of Lenders & Loans for Multifamily Properties is Bigger than Ever

This article appeared in the November 2020 Issue of the Colorado Real Estate Journal's Multifamily Properties QuarterlyThere has never been a better time to be a commercial real estate borrower.  The cliché has been repeated on a loop for the last several years, but it is still truer than ever today.  The Fed has signaled it is going to hold short-term interest rates at near-zero for at least three more years, and credit spreads have stabilized after spiking in the early days of the pandemic.  The net result is we are living in a period with the lowest interest rates the team at Essex has ever seen.  [Author's Update 11/17: Since this article was...

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Construction Loans from Life Insurance Companies are an Attractive Alternative to Banks

Over the past decade, insurance companies have become more active on the construction side of lending in efforts to (1) earn more yield on their loan dollars and (2) provide early opportunities for permanent loan business on newly-built, high quality stabilized product. As a result, many have developed non-recourse construction and construction-to-perm lending programs. Currently, 8-10 of our insurance company relationships are active in this space, especially on deals with loan sizes greater than $25M.With the volatility brought by the COVID pandemic, many insurance companies temporarily halted their construction or construction-to-perm lending programs in efforts to...

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Essex Closes 4 Loans in the Final Weeks of July

Essex Financial Group closed four (4) transactions totaling $23 million in the final weeks of July. The loans financed a mix of asset types, including industrial, multifamily, and office. Since the initial shock of COVID, Essex has seen insurance companies adapt to the current environment, resulting in an uptick in lending activity in the last few months. A summary of the four transactions is as follows:Summit at CTC II - Essex arranged a $5,200,000 permanent loan on a newly constructed 41,000 square foot Class A industrial building in the Colorado Technology Center (CTC). The new loan refinanced the existing construction loan and was placed with a national life insura...

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Capital Markets Update - September 2020

Activity in the capital markets has significantly increased as we near the end of summer and as lenders and borrowers settle in to a “new normal”.  Lenders still have a strong demand for commercial mortgages and are actively lending on all major property types. Most of the activity has come from refinance requests as property owners seek to capitalize on interest rates that have moved lower since the start of the pandemic.  Competition for mortgages is increasing, and borrowers are set to reap the benefits.   The team at Essex has been actively marketing a variety of new loan requests in recent weeks, and has identified the following trends: Multif...

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Pandemic Highlights Benefits of Relationship Lending

This article appeared in the August 2020 issue of the Colorado Real Estate Journal's Retail Properties Quarterly  https://crej.com/current-issues-and-archives/As the coronavirus pandemic enters its sixth month and with no signs of abating, retail property owners are facing unprecedented challenges on multiple levels. For those retail owners unable to pay their existing commercial mortgages or those that are facing an upcoming loan maturity, these challenges are especially acute. While the pandemic and its associated government and public health response has dramatically changed consumer behaviors, what hasn’t changed is the importance of strong lender relation...

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EFG Denver Business Journal Spotlight

The past 4 months have changed life as we know it. In our personal lives as well as in our professional lives, we’ve all had to make changes and adjustments to adapt to this unexpected global pandemic. And while it hasn’t been easy for us at Essex Financial Group, it has pushed us to re-emphasize our service-oriented approach to business. As with most companies, the beginning of the pandemic meant shifting to working-from-home with the hope that it would be over in a few short weeks. After a couple of weeks of retail businesses being shut down, the calls started coming in. “My tenants aren’t sure they will be able to pay rent.” “Will my lender approve this lease modificat...

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