Finance CMBS
Inland American Sees Opportunity in RE Debt
Aug 5, 2008
By: Dees Stribling, Midwest Correspondent

Inland American Real Estate Trust Inc., through a subsidiary, has committed to invest $100 million in Boston-based Concord Debt Holdings L.L.C., whose specialty is the acquisition of real estate securities and other real estate-related loans. The initial investment is $20 million, with as much as $80 million more over the next 18 months.

Concord Debt Holdings is a joint venture between Winthrop Realty Trust and Lexington Realty Trust. Both companies are REITs, with Boston-based Winthrop owning a variety of commercial properties, and New York-based Lexington specializing in net-leased properties.

Under the terms of the deal, contributions by Inland American will be used primarily for the origination and acquisition of debt instruments, including whole loans, B notes and mezzanine loans. According to Oak Brook, Ill.-based Inland American, dislocations in the credit markets make now a good time to invest in commercial real estate loans and other forms of debt.

Also, provided certain conditions are satisfied--including payment of Inland American’s 10 percent priority return--both Winthrop and Lexington may reduce their aggregate capital investment in the JV to $200 million through distributions of principal payments from the retirement of existing loans and bonds in Concord’s current portfolio.

Inland American is also a REIT with a diversified portfolio and part of the Inland Real Estate Group of Companies Inc. Inland Institutional Capital Partners Corp. negotiated the deal on behalf of Inland American.

 
Recent CMBS Headlines
paulson A Bailout for Commercial Real Estate?
Dec. 22, 2008
"Right now, we believe there is insufficient systemic capacity to refinance expiring, performing commercial real-estate loans," reads a letter from a dozen commercial real estate trade groups to Treasury Sec. Henry Paulson, according to the Wall Street Journal this morning. In other words, the commercial side of the business, long perceived as relatively healthy compared with the residential side, is warning of dire straits ahead unless refinancing money is available in the near future.
CMBS Delinquencies Speeding Up: Fitch
Dec. 22, 2008
Back in January 2008, long before the capital markets took their astonishing twists, Fitch Ratings made a sobering prediction: By the end of the year, its CMBS loan delinquency index would be double or triple the 0.28 percent recorded at the end of 2007. Fitch’s crystal ball turned out to be right on the money. On Friday the ratings agency reported that CMBS delinquency reached 0.64 percent for November. At this pace, Fitch projects that CMBS delinquencies could hit 2 percent by the end of 2009.
ProLogis Buy Eases Debt Squeeze on European Unit
Dec. 22, 2008
Facing a looming CMBS debt maturity next summer, ProLogis European Properties is getting some much-needed breathing room from its corporate parent. In a deal valued at about 43 million euros, or $61 million, Luxemborg-based PEPR is selling ProLogis a 20 percent share of a private investment fund.
Loan-Extension Picture Could Be a Lot Worse
Dec. 17, 2008
In the first decline since July in the delinquency rate among U.S. commercial real estate loan collateralized debt obligations, that rate fell from 3.13 percent in October to 2.80 percent in November, according to the latest information from Fitch Ratings.
 
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