CMBS

  • Innovative workout for Apple loan

    Hatfield Philips International has successfully implemented a workout strategy and restructuring of the €225m Apple loan, securitised in the Talisman 6 Finance CMBS (see SCI's CMBS loan events database). As part of the restructuring, the parent companies of the borrowers consensually agreed to transfer their shares in the borrowers to two newly-founded independent Irish holding companies.

    Originated in .......

    News Round-up 7 August 2014

  • Smaller agencies gain market share

    The use of smaller rating agencies has become more common for US CMBS 3.0 deals, particularly as Moody's, S&P and Fitch have tightened their criteria in response to perceived weakening in credit quality. The move could potentially limit liquidity on these bonds if some investment mandates still require investment grade ratings from one of the top three agencies, according to .......

    News 5 August 2014

  • Credit benefits

    Reach for yield outweighs macroeconomic concerns

    The US credit markets enjoyed a positive first half, with some sectors seeing returns in the high single-digits due to consistent spread tightening and rate compression. The strongest performing segments were those with exposure to interest rate duration.

    "Credit has benefited from several helpful trends: accommodative central bank policy, low default rates and benign treasury rates," confirms Chris Acito, ceo .......

    News Analysis 5 August 2014

  • Auctions exposed to LNR assets

    US$589m of allocated balance from US$775m in US CMBS loans is set to be sold via Auction.com in late August and early September. Three deals have a high concentration of loans out for bid and the properties appear to be exclusively specially serviced by LNR, according to Barclays Capital data.

    The COMM 2006-C8 deal has the largest exposure to the auctions, .......

    News Round-up 4 August 2014

  • CMBS 2.0 defeasance emerging

    Fitch says it has provided rating confirmations for 26 defeased loans in US CMBS thus far in 2014, three of which were from CMBS 2.0 transactions that occurred in July. Two others were in 2011 transactions and another in a 2010 transaction. Each of the loans has five-year terms.

    The appearance of 2.0 requests marks the beginning of an expected .......

    News Round-up 4 August 2014

  • Specially serviced loans decrease

    The accelerating US economic recovery led to a further decline in CMBS delinquency rates and a decrease in the share of loans in special servicing, according to Moody's 2Q14 surveillance review. The agency's base expected loss for conduit/fusion transactions fell to 8.2% during the quarter from 8.6% in Q1.

    "The improving economy contributed to the decline in Moody's base expected .......

    News Round-up 1 August 2014

  • CMBS credit metrics slide again

    Leverage and other key metrics for US CMBS slipped again in Q2, driving credit enhancement levels for new deals higher still, according to Fitch's latest quarterly index report on the sector. Average triple-A CE for Fitch-rated transactions rose to 24% during the quarter, up by 1.125 percentage points from the prior quarter and 2.375 percentage points from one year ago. .......

    News Round-up 1 August 2014

  • Loss severity ticks up

    The US$82.9m Babcock & Brown FX 2 loan last month liquidated with a 95% loss, after being delinquent for more than two years (see SCI's loan events database). Coupled with low volume, Trepp notes that this large loss contributed to an up-tick in aggregate loss severity, which jumped from 45.32% in June to 60.80% in July.

    Liquidated loan .......

    News Round-up 1 August 2014

  • First loss for FREMF programme

    The US$3.7m Green Meadows Apartment loan - securitised in FREMF 2010-K6 - has been liquidated at a realised loss to the trust of US$374,943, representing a loss severity of approximately 10%. CMBS strategists at Morgan Stanley believe that this is the first loan securitised across any FREMF CMBS to realise a loss.

    According to special servicer commentary, the property was .......

    News Round-up 1 August 2014

  • Loan resolutions slow

    The US CMBS delinquency rate dropped by just 1bp to 6.04% in July, according to Trepp. Loan resolutions totalled only US$600m during the month: with fewer distressed loans removed from the delinquent loan pool, newly delinquent loans pushed the monthly total back up. Trepp currently counts US$32.1bn in delinquent CMBS loans, which is down from June's total.

    "After so many .......

    News Round-up 31 July 2014

  • Methodology guidelines finalised

    Scope Ratings has finalised its methodology guidelines for rating and monitoring structured finance instruments, taking into account market comments and other feedback following the publication of a draft proposal. These guidelines provide the general framework for the development of in-depth methodologies. Scope plans to issue subsequent addenda to these guidelines in order to define its specific assumptions for rating structured .......

    News Round-up 31 July 2014

  • CMBX differential 'too wide'

    Markit CMBX.6.BB reference obligation spreads have tightened by 135bp since the beginning of the year, while the index itself tightened by about half that. Consequently, the CMBS cash/synthetic basis has widened by over 70bp during that period and is now at its widest level since October 2013, according to Bank of America Merrill Lynch figures. The basis has widened by .......

    News Round-up 30 July 2014

  • CMBS leverage on track to match peak

    US conduit CMBS loan leverage is now growing at such a pace that by 2017 it will have returned to its 2007 peak, according to Moody's. Loan underwriting standards continue to loosen, with Moody's loan-to-value (MLTV) ratios for conduit loans now on track to match the peak of 118% MLTV, set almost exactly ten years ago.

    "We've been raising credit .......

    News Round-up 30 July 2014

  • Freddie debuts unusual CMBS

    Freddie Mac priced what is believed to be a first-of-a-kind CMBS last month. The US$393m FREMF 2014-KX01 comprised 20 loans that were removed from previous securitisation pools by Freddie Mac or at the request of a B-piece buyer.

    The transaction features a two-tranche structure consisting of US$334m class A notes (guaranteed by Freddie Mac) and US$59m class B notes (not .......

    News Round-up 30 July 2014

  • Real estate investment leader added

    Strategic Partners Fund Solutions has appointed Mark Burton to lead it real estate secondaries practice. He will serve as a principal and oversee the firm's secondary real estate investment activities.

    Burton joins from H/2 Capital Partners, where he focussed on distressed commercial mortgage opportunities. Before that he spent 11 years at Goldman Sachs, overseeing domestic CRE investing and lending.

    .......

    Job Swaps 29 July 2014

  • European alternative

    Stefan Bund, group md and head of asset-based finance at Scope Ratings, answers SCI's questions

    Q: How and when did Scope Ratings become involved in the securitisation market?
    A: Scope Ratings was established in 2002 as a funds analysis house, specialising in the commercial real estate, SME and infrastructure sectors. The company expanded into the credit rating business in 2012 by merging with a smaller German rating agency.

    Scope's move was .......

    Provider Profile 29 July 2014

  • Non-core sales bring CMBS boost

    The recapitalisation of European CRE lenders through non-performing or non-core CRE loan sales should provide a supply of new opportunities. This, in turn, could potentially fuel increased European CMBS issuance.

    CRE loan and REO sales for the first half of the year totalled €40.9bn, compared to €30.3bn for the entirety of 2013, according to Cushman & Wakefield Corporate Finance. Bank .......

    News 24 July 2014

  • Defeasance on the rise

    US CMBS loan defeasance volume has increased significantly over the last 18 months, jumping from an average of US$3.3bn per year in 2011 to US$11.8bn in 2013, according to Trepp. Through the first half of 2014, defeasance volume is on pace to beat last year's level by almost US$1bn.

    With rates and spreads expected to remain low in the near .......

    News Round-up 24 July 2014

  • Ratings probe initiated

    McGraw Hill Financial has filed a Form 8-K with the US SEC acknowledging that it received a 'Wells Notice' stating that the Commission has made a preliminary determination to institute an enforcement action against S&P. The notice alleges violations of federal securities laws with respect to S&P's ratings of six CMBS issued in 2011 and subsequent public disclosure made by .......

    Job Swaps 24 July 2014

  • Mixed bag out for busy CMBS session

    US CMBS BWIC volume totalled around US$650m yesterday as a mixed bag of securities from various vintages were put out for the bid. SCI's PriceABS data captured a range of price talk and covers.

    PriceABS picked up 29 unique US CMBS tranches from yesterday's bid-lists, including the BAYC 2006-4A A2 tranche. That tranche was talked at .......

    Market Reports 23 July 2014

  • Cumulative defaults remain flat

    Fitch's quarterly US fixed-rate CMBS cumulative default rate remains flat at 13.5%, due to relatively stable default and new issuance levels. In 2Q14, 68 loans totalling US$974.5m were newly defaulted, down from 91 loans (US$1.1bn) in 1Q14 and 97 loans (US$1.4bn) in 2Q13. Of the loans sized at over US$20m, 12 accounted for approximately 62% of the total newly defaulted .......

    News Round-up 21 July 2014
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