Presenter: Richard Hamm, Advantage Consulting and Training
This 90-minute program will be presented live on: February 14, 2023 – 10:30 a.m. – 12:00 p.m. CT
Recording available through: May 14, 2023
Can you identify the factors that cause cap rates to increase or decrease? How can you mitigate the risk posed by properties with short leases and underlying loans with long amortizations (re-lease or rollover risk)? Whether directly financing commercial real estate (CRE) or including CRE income stream(s) in your overall credit analysis of a borrower, it is important to understand key analytical concepts in evaluating CRE beyond the cash flow and debt service coverage (DSC) and loan-to-value (LTV) ratios. This program covers how capitalization (“cap”) rates are derived and their role in the income approach to CRE market value. It demonstrates (from a case study) how bankers can estimate property values as part on ongoing monitoring of CRE loans. We also cover the qualitative or non-financial issues that affect CRE performance, including re-lease and rollover risk.
Specific subjects that will be covered during the seminar:
Target Audience: Commercial lenders, credit analysts and small business lenders; consumer lenders, mortgage bankers and private bankers; loan review specialists, special assets officers, lending managers and credit officers