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Q3 2020 Before, Now & Future Of COVID Lending

"Total REIT returns by property type over the past 12 months are industrial at +11per cent, residential at -10 per cent, retail and office at -17 per cent, seniors housing at -30 per cent, diversified at -36 per cent and hospitality at -60 per cent.” At the same time the YTD equity raise number is at a meagre $1.5B second lowest since 2008 and the equity raise by sector also mimics the returns above for e.g., majority of capital raised is in the Industrial REIT sector and none in Retirement/Hotel sector."

Do these return metrics and capital inflows also reflect the state of lending appetites across different ASSET types when it comes to senior and mezzanine debt? Are there any outliers when it comes to commercial mortgage lending? Q1 a) Re Office and Retail Sector: Any reserve accounts being set up to plan for vacancies in case of Wave 2? Q1 b) Is there any opportunistic lending that is happening in the Hospitality or Retirement sector currently? Q1 c) Any potential follow ups coming through above discussions for e.g.,…spreads, underwriting rates for DSCR, covenants (past, current and future?

QUESTION 2. Are you Bullish or Bearish on projected exit prices on residential projects? And How does that tie into your thesis on underwriting land and construction loans? What underwriting metrics (if any) have changed in terms of comfort around loan exposure bpsf, cash equity reuired and land lift? Q2 a) Is there a bias to lend on urban core vs suburban projects? Q2 b) Rental market has softened significantly over last few months…where do you see lending appetite over next 6 months for rental construction?

QUESTION 3. If you imagine that you are in Year 2025, what would be one (will ask each panel member) “Fundamental Shift” that will be directly attributed to this Pandemic. And I will preface that question with a statement from: Microsoft CEO Satya Nadella who recently said, “We’ve seen two years’ worth of digital transformation in two months.” What does this mean for our industry?



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