Joel Ross is principal of Citadel Realty Advisors, successor to Ross Properties, the investment banking and real estate financing firm he launched in 1981. A Wharton School graduate, Ross began his career on Wall Street as an investment banker in 1965.
The yield curve is the plot of the rates as you go out by maturity. The left side is the short rates (i.e. one month) and the right is the long rates (i.e. 30 years). The slope of this curve has been fairly good at predicting where rates are headed over the next few months and the cost of borrowing.
While there has been a new start to CMBS lending and hotel lending in general, do not get lulled into believing it is all sunny and you can easily refinance at 5% or less. There are only a few lenders who are active.
We used to use debt service coverage ratio to measure the risk of a loan and to size the loan proceeds. Now the mantra is debt yield. That is, net operating income divided by 14% to determine proceeds.