boston - The Real Reporter

48CRE FINANCINGcontinued from page 6made its presence felt in the region, originating$30 million in CMBS loans in suburban markets,including $19 million for a MarriottCourtyard in Marlborough.Life companies, on the other hand, areresponsible for financing some of the Bay State’sbiggest deals.Among the more prominent transactionsthrough June 30th were NorthwesternMutual Life Insurance Co. providing two mortgages($139.5 million and $52.2 million) toSamuels & Associates for the developer’s ambitious600,000 sf mixed use project at 1325Boylston near Fenway Park; Connecticut GeneralLife Insurance Co.’s $28 million mortgage forForest City’s project at 26 Lansdowne St. inCambridge; Allianz Life Insurance Co. of NorthAmerica granting MIT an $82 million mortgagefor their project at 634 Memorial Dr; New YorkLife Insurance Co. providing Cabot Properties$53.9 million for their industrial property at 13Centennial Dr. in Peabody; and MassachusettsMutual Life Insurance Co. delivering a $15.8million mortgage for 53 Third Ave in Burlingtonto owner Nordblom Co.The big banks have made their presence feltas well, with Bank of America providingover $180 million in mortgages,including $43.0 million to PembrokeReal Estate Inc. for 237-255 State St.,Boston and $41.6 to Saxon Partnersfor the Colony Place lifestyle center inPlymouth; JPMorgan Chase Bank providingover $125 million in mortgages,DARRYL FESSJAMES RIZZOincluding $90 million for industrialprojects at 2 and 24 Nemco Way, Ayer;and 11 Harvest Ln., Southborough forEquity Industrial Properties; PNC Bankoriginated four mortgages for morethan $110 million, including a $60mortgage for the Boston Marriott inNewton owned by ChesapeakeLodging Trust; Sovereign Bank passedthe $100 million mark with $47.2 millionto finance a Hines apartment project at 36River St. in Waltham. People’s United Bank is inthe $150 million sphere for the year.The change in treasuries is also affecting thesmaller banks, who are adjusting by cappingterms at seven years and in some cases, cuttingthe length to just five years. “The gap betweenseven-year treasuries and 10 is 50-75 basispoints, so if you’re willing to shave three years ofterm, you can regain almost half a point or morein rate exposure, and you can claw your way backto where we were two months ago,” reports111 Speen St., Framingham MABlack. “On the smaller end, we’re starting to seesome of the more local and quasi mutual bankspull back on the 10-year money because they’renot winning deals lately and the cost of lendinghas moved so much in the past 60 days. Soyou’re starting to see the seven-years as theirmax term.”Many of the regional and local banks arereporting that the first half of the year has beensolid, with a diversified CRE loan portfolio that isless weighted toward multifamily thanprevious years. And the competition fordeals for quality assets across the boardhas become fierce, according toNicholas K. Moise, Eastern Bank’s SVPof Commercial Real Estate. “We’recompeting with larger and smallerbanks (Eastern has assets of $8.5 billion).Most good deals we’re looking attoday have double-digit term sheets, somost good deals will have 10 or moreother institutions, whether it be banksor life companies or even conduits(competing).”Eastern has originated approximately$250 million in CRE loans sofar in 2013, a 10 percent increase overthe first six months of 2012. High profiledeals include the $34 million mortgage forTaurus Investments purchase of office/retailproperty at One Newton Pl. (in Newton) and a$23 million mortgage (of a $34 million pricetag) to Synergy Investments for 11 Beacon St. inBoston acquired in early 2013 from DivcoWest.Brookline Bank’s Darryl Fess, who heads upthe commercial lending group, says his institutionhas “$150 million out the door with minimalconstruction loans” in the first six months of2013, and that he expects to do “about $300million this year.” Brookline Bank enhanced itsTHE REAL REPORTER 2013 SUMMER REVIEWability to do larger loans in recent years whenthey acquired Ipswich First (2010) and BankRhode Island (2011) and expanded their loancapacity to $35 million. “We’d love to say wewere doing a lot of multi-family, but earlier in theyear we lost a lot of it in this incredibly low-rateenvironment to Fannie, Freddie and the life insurancecompanies as a lot of it was refinanced out,but we replaced (those dollars) with more officeand industrial,” explains Fess. Brookline Bankprovided $18 million to Cargo Ventures to refinance440-480 McLellan Highway, a modernoffice and warehouse facility near the airport;and a $15 million refinancing for a five-propertyoffice portfolio in Needham and Newton as wellas $3.0 million in financing for a 225,000-sfindustrial facility that went to the Grossman Cos.for $7 million.Rockland Trust Co., which financed a pair ofhigh profile deals on Back Bay’s Boylston Streetlast fall, is also off to a brisk start, with a slew offinancings in the Bay State running from $2 millionto $7 million, plus 50 percent of the financingfor Foxrock’s $10.5 million buy of WeymouthWoods Corporate Center. The lender also delivereda $10.5 million mortgage for a flex buildingin West Bridgewater for CDF Corp., and a numberof hospitality oriented deals in Rhode Island.“The macro story is that loan demand in the firsthalf of the year has been steady, and the competitionhas definitely heated up,” conveys JamesRizzo, Senior VP and regional lending manager ofcommercial banking at Rockland Trust. “But wecontinued to be very selective and maintain thesame credit posture that we’ve had over the lastfive years.” Rizzo was alluding to whispers by anumber of lenders that a small number of mutualbanks and credit unions are “becoming very,very aggressive in terms of structure and in priccontinuedon page 49