Thinking about ultra luxury hotel and/or AAA+ office deals in US.
Does anyone have historical context as to how tight spread got pricing 10 year CMBS loans for these types of trophy assets? Conduit and SASB (do they typically price similarly or is one tighter than the other?).
Given where the current yield curve sits today, 10T is predicted to slowly trend higher, hitting 5.0% in 2031. If Freddie/Fannie securitized pricing for 10 year money is 175-200bps over (assuming 60% LTV), is there any rationale way that spreads for A+ hotels should price tighter than 200? I realize that cap rates for these assets may not track interest rates bp for bp, but unless unlevered foreign money starts buying hotels again, how can an owner justify a 5 handle cap rate for a Four Seasons or similar when financing is still running 7-8% for these types of assets?
Justify some sort of "value creation" post close, charge management fees to investors, who cares what happens next. Welcome to the retarded world of real estate.
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