Interest Rate Cap Woes and Mounting Defaults But Plenty of New Financings

This week, the nonperforming loan on Soho Properties’ luxury condo tower at 45 Park Place in Tribeca is being marketed for sale; billionaires Vlad Doronin and Len Blavatnik score a $243M loan for Aman in Miami Beach; and we bring you the latest on the Commercial Real Estate Finance Council (CREFC) conference in Miami. This week, CRE sponsors feel the pressure of soaring interest rate cap costs; defaults are flooding the beleaguered office market; a bank trio teams up on a $150 million industrial financing; and Bank of America’s Maria Barry gives her affordable housing outlook.   Rising Interest Rate Cap Costs Pressure CRE Borrowers Soaring costs for protections against rising interest rates are further pressuring commercial real estate property owners saddled with floating-rate debt. [Read More](   TOP DEALS OF THE WEEK - Protective Life, Old National Bank, One America Lend $150M on [Industrial Portfolio]( - Western Alliance Bank Lends $80M for Inland Empire [Warehouse Development]( - Douglas Development [Secures]( $107M to Build Takoma Park Apartments - Wells Fargo Refis [Battery Park City]( Resi Tower With $98M Loan - Hall Structured Finance Lends $53M on [New Jersey]( Multifamily Development - Lynd Scores $126M [Construction Loan]( for Rental in Royal Palm Beach - Webster Bank [Lends]( $34M on Meatpacking District Office Asset - Terra and AB Nab $44M to Begin Work on Lux [Miami]( Condo     GUEST COLUMNIST NY Policymakers Need to Focus on Incentivizing Office Conversions, Upgrades With the state budget due in less than one month, market participants are on the edge of their seats to see what will be included, writes Robert Knakal head of the New York private capital group at JLL. [Read More](   Q&A Bank of America’s Maria Barry On Financing Affordable Housing Post-COVID The national executive for Bank of America’s Community Development Banking sees momentum for new projects nationally despite rising interest rates [Read More](     OTHER STORIES FROM THE WEEK A Flood of Defaults Swamps Big Names and Big Properties, Especially Offices The dam holding back default filings — especially in the office market — clearly has burst. [Read More]( Burton-Katzman, DRA Advisors Team Up on $240M Industrial Portfolio Recap Burton-Katzman and DRA Advisors have formed a $240 joint venture equity partnership to recapitalize 24 infill light industrial properties in the Midwest. [Read More]( Blackstone Defaults on $562M Bond on European Office Buildings Blackstone has defaulted on a $562 million bond backed by Finnish landlord Sponda Oy, which it acquired in 2018, something Blackstone said was exacerbated by Russia’s war against Ukraine. [Read More]( CMBS Delinquencies Jump in February The delinquency rate for commercial mortgage backed securities rose 33 basis points in February to its highest level since April 2022, according to CRED iQ. [Read More]( WeWork in Talks With Lender to Restructure $3B in Debt Faced with dwindling cash reserves and the possibility of loan defaults, WeWork tapped its investors to raise more funds and restructure its outstanding debt of more than $3 billion to carry the ailing company a few more years. [Read More](     WHAT WE'RE READING - Irish property market shows new [stress]( when fund blocks withdrawals [Bloomberg] - Fed Chair Powell says [interest rates]( are ‘likely to be higher’ than previously anticipated [CNBC.com] - The lucrative life of an [Adams insider]( who has left City Hall [NYT]   To forward this newsletter to a friend, [click here](. To manage your email preferences or unsubscribe [click here](. Visit the [Commercial Observer]( for the latest commercial real estate news. For advertising information, [download the media kit](. © Copyright 2023 [Observer Media]( 1 Whitehall Street, Floor 7, New York, NY 10004 This newsletter was published 03/09/2023. [View this email in a browser](.