Fund Investors Load Up on Property Debt
[{"id": "deyjd1r", "text": "This worked out well last time. ", "replies": [], "depth": 1}, {"id": "deyrrfn", "text": "Oh boy here we go again.  The commercial RE boom bust cycle just keeps on turning.  Its been about 10 years so we are right on time for the next one in the next few years.", "replies": [], "depth": 1}, {"id": "df25ksn", "text": "What are the implications of this? Does \"loading up on property debt\" mean issuing new loans (thus lowering borrowing costs across the board), or buying loan securities? If the latter, so what?", "replies": [{"id": "df7ug8a", "text": "These funds are also originating new loans, sometimes venturing into the traditional banking turf.\n \nThe funds have less regulations than the banks and long-term, regulators will need to keep an eye on this activity. The structure of the loans might differ from traditional banks\u2019 in order to boost the yields for the funds.\n", "replies": [{"id": "df7urq6", "text": "So what does this mean, on a macro scale? If funds typically take equity positions in real estate deals, why are they shifting to debt positions in deals?", "replies": [], "depth": 3}], "depth": 2}], "depth": 1}]