It is widely believed that the CMBS markets need to be brought back to life

Words of Wisdom from my colleague Eric Better, at SVN:

Capital markets cannot and will not grow due to a lack of credit and refinancing resources. During the last downturn in the markets, it was through CMBS that the market saw new sources of capital. The government has introduced a new program that is designed to ease the burden of troubled mortgage securities that have been placed upon the banks. The government plans to match the investments and provide a loan program for investment banks to buy the discounted troubled securities.

Many people will view this as a bailout for the companies who created the problem, giving them another way of making huge sums of money. A newly introduced government program, Public-Private Investment Program (PPIP), was created to generate $12 billion to purchase troubled mortgages and CMBS. Compared to the $50 billion maturing in CMBS markets in the US and $3 trillion worldwide, this is a very insignificant amount, but the positive in all of this is that there are actions being taken to remedy the situation.

The goal of these initiatives is to jump-start transactions to remove troubled assets off company books. While it is still unclear if these actions will be enough to salvage the markets, one thing is clear, foreclosures will rise. As more borrowers see their cash flows decreasing and find it difficult to make the payments on their loans, they will have no choice but to foreclose. To solve this problem the FDIC will have to sell assets from portfolios of banks that have been taken over by the agency. Before the agency can do this, it has to restore confidence in investors and give them a reason to buy these troubled assets and securities. With the collapse of the markets it is clear that self-regulation does not work. With CMBS being an integral part of jump-starting the markets, many feel that the recovery will still take some time.

You will find Nationwide Multi-Family interest rates in the 4-5% range and commercial interest rates can be as low as 5.25% with select programs still offering non-recourse financing.