According to a recent report by ""DebtX"":http://www.debtx.com/default.asp, a full-service loan sale advisor based in Boston, the aggregate value of DebtX-priced commercial real estate (CRE) loans that collateralized commercial mortgage-backed securities (CMBS) dropped to 75.9 percent as of December 31, 2009, falling 1.8 percent from November 30, 2009.[IMAGE]
CRE loan prices also declined on an annual basis, DebtX reported. With year-end prices at 75.9 percent, loan prices for all of 2009 fell 5.4 percent from 81.3 percent on January 30, 2009.[COLUMN_BREAK]
""Weakening commercial real estate fundamentals were a major theme of 2009,"" said William Looney, president of loan sales of DebtX. ""In December, the trend of declining CRE performance, combined with rising risk-free rates and a steepening yield curve, led to another drop in U.S. CMBS collateral prices.""
As of December 31, 2009, DebtX priced 60,360 commercial real estate loans with an aggregate principal balance of $706 billion. Collateralizing 628 U.S. CMBS trusts, each of these loans received a DXMark-the first objective valuation of commercial real estate portfolios based on actual secondary market loan sales.
With DXMark, financial institutions are able to make more informed decisions about their loan portfolios, DebtX said. In addition, this valuation helps credit policy executives, risk managers, workout teams, and other senior executives analyze risk, validate origination prices, and evaluate merger and acquisition opportunities.
DebtX's valuations are based on actual secondary market sales of CRE loans that take place at DebtX, an online marketplace for loans.