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| It depends upon the type of group, of course, but these hedge fund operators like these 30 percent or better deals which requires a lot of leverage and depreciation....up until the last year, international luxury resorts have been the hot item and in some respects are still hot if the folks have plenty of their own capital...the last offer I witnessed about 8 months ago for a Costa Rican project was 18% interest for the 1st year, 20 for year 2 & 24 for year 3 with all of the first years interest in escrow & 1/2 of year 2&3 in escrow plus 3% off the top for the underwriter....this was a no-recourse deal with 100% financing...(development financing) but in my view is impossible to even consider. But, some people do bite into these deals and is one reason so many folks are stuck at this moment. It is not just the banks & their private subsidiaries stuck....I am aware of some fortune 500 companies who jumped in some of these projects when the going rate was 12-16-18 on a 3 year deal & while I have not kept up to date...they are most likely in stuckville also. | |
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Money Guys
