Commercial Construction Development Finance Future, At Risk or Not? The United States is undergoing a skyscraper renaissance with its megacities, New York, Chicago and Seattle leading the skyward charge. Measuring over 1,400 feet, New York's 111 West 57th Street is set to be one of the tallest buildings in the country, while Wolf Point South, will be one of the biggest construction projects Chicago's history. In Seattle, on the Pacific coast, two megaskyscrapers - Fourth and Columbia are reaching for the clouds. Elsewhere around the world, skyscraper projects in Dubai and China continue to make very strong statements with some of the tallest buildings in the world coming up there. Construction finance from Park West Capital has been a part of many market changing building projects around the United States. Stricter regulations and scrutiny with regard to loans are altering the financial eco-system in the construction industry and yet, the boom in this sector seems stronger than ever. Financing parameters have changed for lenders as there are now new rules for High Volatility Commercial Real Estate (HVCRE) loans covering acquisition, development, and construction of commercial buildings. Under these new rules, finance companies should have a 15% equity stake on the loans it provides. Failure to do so invites a 150% risk weight requirement. In such circumstances raising funds for construction projects has become a little more challenging. A bridge loan from Park West Capital is an excellent option for construction companies seeking expedited funding for equity or debt and short-term stabilization finance. The attention of regulators over banks that are expanding their commercial real estate lending activity will continue to be strong. The regulators will also keep a close eye on banks operating in high-risk markets like the multi-billion dollar construction projects coming up across the largest American cities. They are wary about a recent federal analysis that showed the increasing tendency of banks' to underwrite policy exceptions for many of these mega-construction projects. They feel these banks are willfully and consistently neglecting oversight of their credit. Most banks in the US are therefore under pressure from regulators and are hesitant in extending credit. Construction finance from Park West Capital is not just compliant with government regulations but is designed to be a win-win deal for all stakeholders. Stricter regulation has forced many banks to either reduce lending activity, especially in the HVCRE credit market or look at other industries. In addition to that, there are concerns about the global economy, including a slowdown in China, turbulent oil prices and the looming trade war between the US and China with unforeseen consequences for the capital market. Understandably, the real estate sector has been adversely affected by the reluctance of banks to roll out credit as easily as they used to do earlier. Construction companies considering a bridge loan from Park West Capital can rest
assured that they will be dealing with a professional organization that deals transparently and professionally.