JLL Capital Markets finds retail lending remains active with insurance companies and local banks

Claudia Steeb

CHICAGO, IL – Various coronavirus stay-at-home orders affected retail investment sales transactions in the early days of the pandemic, but insurance companies and local bank lenders kept capital at the ready for deployment into retail.

With historically low interest rates, JLL Capital Markets retail debt placement teams have closed $542.83 million worth of retail financings since July, demonstrating the lending community’s confidence in segments of the retail sector.

 “There is a myth that retail is unfinanceable today, and that’s absolutely untrue,” said Christopher Drew, Senior Managing Director, Capital Markets, JLL Americas.

“When structured appropriately, plenty of financing is available to investors. In fact, certain lenders, like local and regional banks, never stopped lending.”

Record-low interest rates are also bringing new investors to the sector, according to Claudia Steeb, Managing Director, Capital Markets, JLL Americas.

“Investors notice these rates and see an opportunity to expand their holdings and balance out their portfolios with retail acquisitions, possibly at a discount.”

 Steeb also says flexibility is vital to retail lending, which is causing the type of lender providing the most agreeable terms to shift.

Christopher Drew

 “Even though we are working with all types of lenders, insurance companies and local and regional banks are paving the way toward getting retail deals done in 2020,” Steeb explained.

“They have flexibility, tend not to have significant exposure in any particular asset class and are able to arbitrage the market so when competitors pull out, they can jump in and gain extra yield for their portfolio.”

  Steeb points out that JLL is seeing other lenders, such as bridge lenders, debt funds and CMBS, underwriting well-located retail assets with strong sponsorship and existing supportable cash flow to determine if they can sell their loan committees and/or rating agencies on the retail loan opportunities.

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 CONTACT:

Kimberly Steele,

JLL Senior Associate

 Public Relations

Phone: +1 713 852 3420

Email:  Kimberly.Steele@am.jll.com