In the past two weeks I received 4 different data points that shed some light on the practical problems in Commercial Mortgages. My friend Emory, a skilled business broker had two separate large (greater than $10,000,000) deals fail because the lenders pulled out at the last moment. Separately, a client had a large ALF deal fail in North Florida when the bank backed away from the deal, and closer to home, here in St. Pete a land developer friend had a deal fail to make because the bank elected to de-commit.

These were all deals over $10,000,000 and this size loan can have a very real effect on a lending institutions liquidity and reserve requirements. The feds have tightened up on these limits and are visiting many banks to be sure everyone is meeting their reserve requirements. Secondly, with disappearance of the Commercial Mortgage Backed Security Market last year, there is a much smaller market to sell these large commercial loans to.

The smaller deals, under $5,000,000 don't seem to be having these problems as often and are still being services by the local banks and some of the bigger ones. In particular, WaMu is aggressively pursuing Multi-Family loans in the area with very good rates and nice loan terms.