A report from the Real Deal. "Big real estate lenders often find themselves allaying investor concerns about a faltering market. But perhaps no one’s ever done it quite like Johnny Allison. 'The reality was [as] if Peter Pan can no longer fly, Minnie Mouse left Mickey for Goofy, … with Frankenstein piloting to take over the banking industry,' Allison, the chairman of Home BancShares, said on the firm’s most recent earnings call in January. 'Nevertheless, we sent Batman, Superman and Nancy Pelosi to save the day, and they built a wall around the airport and saved us all.'"

"Somewhere in that rant was a message: Despite the doomsdayers, Home BancShares, a lender with significant exposure to South Florida’s real estate market, is in good shape. With just $15 billion in assets, it has become one of the top 20 real estate lenders in the region, with more than $219 million in local commercial real estate loans in 2018, according to an analysis by The Real Deal."

"Centennial’s increased activity while other lenders retreat draws natural comparisons to another Arkansas institution, Bank OZK (formerly Bank of the Ozarks), the most active condo-construction lender of this cycle."

"But according to regulators, the bank might be a bit too zealous.
Its commercial real estate lending relative to its capital levels — a widely used barometer for risk — was 370 percent in 2018. Regulators warn against exceeding 300 percent."

"The bank’s riskiest move, however, came in 2015, when it made its foray into what is largely regarded as the most competitive real estate market in the country: New York City. Late last year, Centennial provided a non-recourse loan to the Jay Group for a mixed-use project in Harlem, according to the Commercial Observer. Non-recourse loans are generally viewed as riskier since a lender cannot go after the collateral of the borrower if there is a default. And the bank has begun ramping up in Los Angeles and Dallas."

"'When you see loan production offices in areas outside of banks core competencies and headquarters, those tend to be pretty risky, those tend to be the ones that result in a bank going down,' said Bill Cormany, a federal bank regulator with the FDIC, speaking generally and not specifically about Centennial."

"Investors are increasingly skittish about community banks’ real estate exposure, as many signs point to a slowdown in prime markets, particularly in the luxury condo sector. There’s also increasing talk of a broader economic downturn. 'Nobody wants to talk about the recession, but it’s going to happen,' said Kenneth Thomas, a Miami-based banking analyst. 'A recession’s greatest impact is going to be on CRE, and the banks that don’t have the strongest underwriting [on CRE]. You can’t be a master of all markets. You got a bank that is so spread out — that becomes a red flag.'"

From Mansion Global. "For luxury homebuyers, the coming season is a treasure trove of opportunity in top markets around the world, which are in many cases seeing either heavy supply or falling prices. And in some cases both."

There are a lot of unknowns in the New York City real estate market currently. On the one hand it is a buyer’s market, but on the other, buyers have been more hesitant to buy recently. Even though more homes were available—and with lower prices—in the 4th quarter of 2018, buyers have been hesitating, according to a quarterly report by Corcoran."

"The Miami-South Florida real estate market is still awash in luxury inventory from the last round of new developments. 'We’ve had an enormous supply of luxury in the last three years in Miami/Dade County,' said Ron Shuffield, president of the Miami-based EWM Realty International. 'We currently have 5,000 units on the market priced over $2 million.' Of those, 1,900 are single-family homes and the remaining 3,100 are condos."

"After several very strong years, the Los Angeles market continues to show signs that it is slowing down. The number of homes sold in Los Angeles has continuously declined since mid-2018, said Selma Hepp, chief economist at Compass. In January, the 'year-over-year decrease in home sales continued at double-digit percentage rates,' with the three-month average decline at 18%."