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Leveraged Breakdowns

George De Rossi

Navigating the Current Bid-Ask Spread in Commercial Real Estate

The commercial real estate transaction market, like many others, operates on a foundation of balance. At its simplest, it’s a meeting ground for sellers and buyers, both of whom aim to get the best deal. But when these two entities can’t find common ground, the bid-ask spread widens and real estate transaction activity slows down. […]

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Commercial Real Estate Syndications – An Introduction

Commercial real estate, a cornerstone of the global economy, often seems out of reach for individual investors. But there’s a tool, employed by seasoned professionals, that democratizes access to these investments: real estate syndications. In this post, we delve into the intricacies of commercial real estate syndications, touching on its primary structures and offering examples

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5 Major Differences Between US and UK Commercial Leases

The world of commercial real estate is intricate and diverse, especially when comparing leasing practices between different countries. For students and early professionals considering a transatlantic adventure, understanding these differences is key. Today, we’ll journey across the Atlantic and delve into the five major distinctions between US and UK commercial leases. 1. Lease Length &

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Bridge/Rescue Financing in Commercial Real Estate

In the dynamic landscape of commercial real estate (CRE), financial products evolve as the industry grapples with emerging challenges and opportunities. The mounting uncertainties of the market, combined with the accelerating need for quick and effective financial solutions, have put bridge/rescue financing under the spotlight. What is Bridge/Rescue Financing? Bridge financing, or interim financing, refers

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Commercial Real Estate Valuation Methods: A Comparative Analysis Across the US, UK, and Continental Europe

Understanding the methods used for commercial real estate valuation is fundamental for all stakeholders, including investors, brokers, asset managers and appraisers. In this blog post, we’ll explore three popular valuation methods: Cap Rate (or Gross Yield), Net Initial Yield, and Net Rental Income (NRI) Yield, with a focus on their use across the US, UK,

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Four Key Ratios to Evaluate Downside Risk

As global financial market volatility continues to rattle investor sentiment, and the possibility of a recession looms, commercial real estate markets have begun showing signs of a slowdown. This is a clear deviation from the commercial real estate industry’s trajectory over the last decade, which was characterized by cheap debt, steady rent growth, and increasing

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Negative Leverage in Real Estate

Almost all real estate transactions are financed with debt, with debt levels dependent on the borrower’s investment strategy, risk tolerance, and capital markets availability. In doing so, investors are able to reduce their upfront capital outlay and increase their return on equity. By incorporating debt, investors can enhance their returns with leverage. But, this is

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Cap Rates and their role in Commercial Real Estate

According to the latest report from the U.S. Bureau of Labor Statistics, the annual inflation rate in June 2022 was 9.1%, its highest level since 1981, as measured by the consumer price index. This persistently high inflation for several months has forced the Fed to rapidly increase benchmark interest rates. The Fed funds target rate

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