We grew up in a world where cash is king. From a consulting standpoint we always took the position the equity wasn’t important in the deal, the disposition of the cash flow was the only important thing because cash is fungible and equity is not fungible. You can’t spend equity you spend cash, right?
Now the world has changed because God loves irony and I am evidently here in this plane of existence for the purposes of looking like an idiot. UFT Commercial Finance has taken credit to a whole new level within the commercial real estate (CRE) finance global marketplace. The outcome is a systemic approach to leveraging CRE equity in a way that produces whole new pools of capital for ADC financing and disposition financing that provides a whole new layer of opportunity to generate still more earnings for those holding portfolios of CRE properties in a way that really makes sense. The outcome is likely to do for CRE what FannieMae has done for multifamily housing but without the bubbles that FannieMae seems to help create on a continual basis.
So what really is fungible? Just about everything and we would all do well to remember that when we think about future economic opportunities over the coming years.