Bottoms up at CREFC Miami

The CRE Finance Council’s annual Miami Beach conference kicked off today at the Fontainebleau Miami Beach with an energy reflective of the buoyant real estate markets.

A 10:30 a.m. networking break after the first official panelist forum saw a swarm of industry experts exchanging pleasantries and sowing the seeds of a new year’s deals.

“We’re all here to make money, right?” one delegate put it bluntly.

Some were already holding down positions at the hotel’s grandiose circular bar . (Was it really water in that martini glass?).

“For me this conference is like a behind-the-scenes glimpse into areas of the market I’m not exposed to on a day-to-day basis,” one lending veteran in attendance said. “When I saw the delegate list this year I knew this was one I didn’t want to miss.”

Back in June at CREFC’s New York real estate conference, Real Estate Capital reported on an optimism that was repeatedly hampered by persistent jitters regarding looming interest rates. Seven months later those fears seem to have dissipated, even though a majority of attendees believe rates will rise in 2015.

“Those jitters are gone,” another attendee said, noting that rates may rise but not enough to quell the increasingly resurgent market sentiment.

A pre-conference CREFC survey of 77 firms showed that 75% of organizations are expecting interest rates to increase 25bps or more. But overall survey respondents anticipate strong investor demand, greater loan volume and improving property fundamentals in the year ahead.

“Industry participants see another year of positive growth for commercial real estate debt markets as ample capital and credit should be available to meet borrower demand and pending loan maturities,” wrote CREFC CEO Stephen Renna.

Renna cautioned that the industry will see a series of new regulations on banks and commercial mortgage lending in the coming years, potentially dampening the market.

Some attendees today directed their fears towards the expanding CMBS market, as the number of originators hovers around 40 and the prevalence of interest-only deals increases.

Perhaps a jitter or two will ultimately rear its ugly head, but for now it’s bottoms up at CREFC Miami. Even if it’s just water for now.

Real Estate Capital’s coverage of the event will continue tomorrow when the panel discussions are officially opened up to the media.