Tag Archives: CMBS

Almost $1.4 billion in commercial mortgage-backed securities (CMBS) conduit loans were resolved with losses in May, according to Trepp LLC. That number was up about 11 percent from April and was the second highest total since the company began tracking this stat in January 2010. During the month of May, 148 loans with a total balance of $1.38 billion were liquidated. The losses on the May liquidations were about $594 million, representing an average loss severity of 43.2 percent.

Provided they live on in their current form, Fannie Mae and Freddie Mac will need another $42 billion from taxpayers over the next decade, according to the Congressional Budget Office (CBO). The agency says subsidies related to the GSEs' new business have fallen but they'll continue to need funding as long as their mortgage guarantees are priced below private institutions. CBO says the government faces two choices: either retain the GSEs' portfolios until the mortgages are paid off, or pay a private entity to assume the guarantee obligations.

The rate at which distressed loans held in U.S. commercial mortgage-backed securities (CMBS) are being transferred to special servicers continues to decline, according to Fitch Ratings. The agency reports that approximately $85.7 billion in loans were being worked out by special servicers as of the first quarter of 2011. Specially serviced CMBS loans reached a peak in the second quarter of 2010 at $91.2 billion. But Fitch has noticed a declining trend ever since and the agency expects it to continue.

The delinquency rate on loans held in commercial mortgage-backed securities (CMBS) fell slightly in May from the new record high set the month before, according to Trepp LLC. The research firm says the percentage of CMBS loans 30 or more days delinquent, in foreclosure, or REO has fallen back 5 basis points to 9.60 percent. Trepp says while it seems small, May's decline is actually the biggest rate drop in about two years. The value of delinquent loans within commercial mortgage bonds now stands at $61.5 billion.

Loans backing commercial mortgage-backed securities (CMBS) that were liquidated at a loss in the first quarter carried an average loss severity of 38 percent, according to Moody's Investors Service. That figure represents a decline from 40 percent for the previous quarter and was the first reduction in the severity of losses since the fourth quarter of 2008. During the month of April, CMBS loans totaling $2.9 billion became newly delinquent, while previously delinquent loans for $3.0 billion became current, worked out, or were liquidated.

Credit Suisse has hired Roger Lehman as managing director and head of commercial mortgage-backed securities (CMBS) research. Lehman, who will join Credit Suisse August 1, will be responsible for research and analysis that will support the bank's re-entry into CMBS origination as well as its secondary trading desk. He was formerly co-head of structured finance research at Bank of America Merrill Lynch.

Bank of America Merrill Lynch announced this week that Alan Todd will join the group in August as head of U.S. commercial mortgage-backed securities (CMBS) research. Todd joins the company from JPMorgan, where he served in the same capacity as head of U.S. CMBS research since 2005. He also spent five years at Bear Stearns, also in CMBS research.

Berkadia Commercial Mortgage has added three key executives to its ranks within the last few weeks. Industry veteran Luther Peacock has joined the company as chief risk officer. Stephannie Mower has been named managing director and will lead the company's newly launched Investment Client Services business. And Mortgage banker Mike Duggan has joined Berkadia's St. Louis office, which is the center of operations for its HUD and Federal Housing Administration (FHA) platform.

After three consecutive months in which the delinquency rate on loans held in U.S. commercial mortgage-backed securities (CMBS) showed signs of leveling off, the rate re-accelerated in April, Trepp LLC reported Wednesday. The New York-based research firm says the percentage of loans 30-plus days delinquent, in foreclosure, or REO climbed 23 basis points last month to hit 9.65 percent. That number is, once again, the highest reading in the history of the CMBS market.

After two years of no issuance, the credit quality of commercial-mortgage backed securities (CMBS) issued post recession has been strong, according to a new report from Moody's Investors Service. Since issuance resumed in 2010, Moody's has rated eight ""new generation"" or CMBS 2.0 conduit deals, and the company says contrary to some market reports, current underwriting is vastly improved compared to four years ago. As the credit cycle continues, however, the ratings agency expects the leverage of the loans in transactions to increase.