Capital is still buying the Sun Belt migration story — in the one region where rents are actually falling — while the markets growing rents trade cheaper. That’s a mispricing hiding in plain sight.

The OCC and FDIC just narrowed what counts as an “unsafe or unsound practice.” The quiet casualty is how examiners police commercial-real-estate concentration risk — and the timing is the story.

While the title of this article may sound a bit dramatic, it is intended to highlight a particular risk that lenders face either before they agree to make a new loan or with respect to loans that are already a part of their portfolio. 

The implosion of the CMBS world contributed monumentally to the economic collapse of 2008. Hindsight can attribute its demise to multiple factors, but three reasons stand out:

The math is pretty clear.  Any multifamily loan originated at interest rates of 2 to 3% is facing a major refinance challenge.