New, Improved Rules For 'High Volatility' Real Estate Loans
Partner Martin Taylor and associate Jon Nomura are published in Law360 for their byline titled, “New, Improved Rules For 'High Volatility' Real Estate Loans.” The pair discuss reformations to the widely unpopular rules relating to high volatility commercial real estate, or HVCRE, loans, summarizing key changes that will impact lending practices with respect to acquisition, development and construction loans. Among the changes, equity is no longer unreasonably trapped in the project; it is now much easier to reclassify a loan as a non-HVCRE ADC loan; borrowers can count the appraised value of property to satisfy the minimum capital contribution requirement; loans made prior to Jan. 1, 2015 are now excepted from the HVCRE rules; and loans with tenant improvement holdbacks are no longer HVCRE ADC loans.