Finance CMBS
Economic Update – CRE Defaults Head for High Ground
June 10, 2009
A new report by Real Estate Econometrics, based on FDIC data, puts the commercial real estate loan default rate at its highest level in more than a decade and a half, at least those loans held by regulated deposit-taking institutions—banks and thrifts, for the most part. The default rate soared from 1.62 percent in the last quarter of 2008 to 2.25 percent in the first quarter of 2009. That rate doesn’t include defaults on loans associated with multi-family rental properties, which Real Estate Econometrics put at 2.45 percent in the first quarter of 2009, up 68 basis points from the previous quarter.
M-F Mortgage Delinquencies Increase in Q1, Says MBA
June 03, 2009
The weakening economy and continued credit crunch led to increases in commercial/multifamily mortgage delinquencies during the first quarter of 2009, according to the latest Commercial/Multifamily Delinquency Report, released by the Mortgage Bankers Association.
Fitch: General Growth Chapter 11 Ruling a Mixed Blessing for Bondholders
May 26, 2009
The special-purpose entity structure that has helped to power real estate finance in recent years remains intact after recent court decisions tied to the General Growth Properties Inc. Chapter 11 bankruptcy filing. However, the rulings may turn out to be less than a total victory for bondholders in the long run.
Economic Update - Legacy CMBS Now Under TALF
May 20, 2009
In a major expansion of the Term Asset Backed Securities Loan Facility (TALF), the Federal Reserve said on Tuesday that investors will be able to buy existing securities backed by commercial real estate loans--so-called "legacy" CMBS. The commercial real estate industry has been pushing for this for some time, and it will at last be possible starting in July.
Stimulus Programs, Financial Market Intervention to Benefit CRE--But Not Right Away
May 19, 2009
The government's pumping up of the economy via various programs created by the nearly $800 billion economic stimulus package and interceding in the financial market will indirectly incite the revival of the commercial real estate market, according to a new report by Marcus & Millichap Real Estate Investment Services. But the major impact is unlikely to be felt this year.
Economic Update - AIG Unloads Choice Tokyo Property for $1.2B
May 12, 2009
American International Group is finally in the news for something other than being a multibillion-dollar black hole for the U.S. Treasury; namely, a property sale. The beleaguered insurer has inked a deal to sell the AIG Otemachi Building and a one-acre site in Tokyo to Nippon Life Insurance Co. AIG will receive about $1.2 billion in cash for the property--a drop in the vast AIG bucket, perhaps, but still a tidy sum.
Economic Update - The Week Starts with Some Good News
May 05, 2009
Is that the glimmer of good economic news ahead, or just a mirage? Time will tell, but for the moment it's good to know that the pending home sales index rose 3.2 percent in March when compared with February, and 1.1 percent when compared with the same month a year ago, according to the National Association of Realtors.
TALF Opens Doors to CRE-Backed Loans
May 04, 2009
The Federal Reserve’s Term Asset Backed Securities Loan Facility has been expanded to cover commercial real estate backed securities and loans.
CMBS Sector Sees Jump in Special Servicing Loans
May 04, 2009
CMBS loan delinquencies and defaults are pushing up special servicing volume at a blistering pace, according to a pair of first-quarter updates published last week by Fitch Ratings.
Economic Update - CRE Refi Problems Loom
April 16, 2009
"Forbearance into foreclosures" was how the Wall Street Journal characterized prospects for the commercial mortgage-backed securities market over the coming years, when many billions of loans underlying CMBS will come due--$22 billion of which will be this year and next. For now, banks have been extending maturities in hopes of some kind of recovery in underlying asset values. But how long they will keep doing that is an uncertainty.
Fitch: Looking for Liquidity, REITs Find Choices, Conundrums
April 06, 2009
Staying liquid is job one for many equity REITs these days, and the lack of a CMBS or unsecured market makes that a formidable task. Most of the choices bring both answers and potential pitfalls at a time of unusual urgency, contends Fitch Ratings in a recent report.
Economic Update - Glimmers of Good News?
March 26, 2009
Are the recent economic initiatives by the U.S. government putting the country on "the road to hell," to quote a certain Czech politician whose own government imploded recently? It is worth noting that good intentions are known to be a common paving material on the road to that unpleasant destination. Or will our ultimate destination be a little less dramatic?
Lending Grew During Q4, Says Mortgage Bankers Association
March 23, 2009
A dearth of financing for acquisition and development has plagued commercial real estate and the general economy for the better part of two years. But a study by the Mortgage Bankers Association published late last week suggests that commercial real estate lending actually started increasing at the end of 2008.
The News: Retail Again Tops CMBS Defaults: Fitch
March 17, 2009
For the sixth time in the past seven months, the retail sector has claimed the dubious distinction of generating more new delinquent securitized loans than any other commercial property category, according to an analysis released by Fitch Ratings yesterday. Fitch predicts a steady increase in loan defaults generated by shopping centers and single-tenant properties this year as soft consumer spending and bankruptcies continue to plague the retail sector.
Fair-Value Accounting Reform Debate Heats Up
March 16, 2009
Securitization took center stage last week in a debate that appears likely to ease the accounting standards that some claim were partly to blame for the CMBS freeze.
Commercial, M-F Delinquencies Rise, but with Silver Lining
March 13, 2009
Commercial and multi-family loan delinquencies increased during the fourth quarter of 2008, as the contracting economy and continuing credit crisis stressed property fundamentals, according to the "Commercial/Multi-family Delinquency Report" released by the Mortgage Bankers Association.
Economic Update -- Cautious Optimism About TALF
March 06, 2009
Will TALF--the Term Asset-Backed Securities Loan Facility, in case anyone's forgotten--bring the securitization of loans, especially non-agency RMBS and CMBS, back to life in any meaningful way? The program will get under way on March 25, and Wall Street is keeping a close eye it. And so are players in some real estate niches that used to obtain much of their capital from securitizations.
Plentiful but Fleeting Investment Opportunities Await, JLL Study Says
Feb. 23, 2009
The commercial real estate investment outlook for 2009 looks grim at best, but there is more to that picture than meets the eye, contends a just-published capital markets report from Jones Lang LaSalle Inc. Smart players who can bring plenty of cash to the table will be poised to reap a once-in-a-generation bonanza.
Economic Update -- Can Geithner Plan Deal With Toxic Assets?
Feb. 11, 2009
What's the money quote from Treasury Secretary Timothy Geithner's speech introducing his plan for all that money Congress allocated last year to TARP II? Maybe it's that the plan will "cost money, involve risk and take time," which he said Tuesday morning.
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