CMBS

  • CMBS outlook 'moderately positive'

    While the US CMBS market has benefited from low interest rates, better access to capital and the recovery in property fundamentals, S&P warns that several economic risks remain. The rating agency predicts GDP growth of 2.6% and has a moderately positive 12-month outlook for CMBS.

    Average credit metrics such as LTV ratios, percentage of interest-only loans and deal diversity have .......

    News Round-up 11 December 2013

  • US CMBS inches wider

    US CMBS spreads inched wider yesterday as bid-list supply came in at around US$200m. SCI's PriceABS data recorded several covers from the session, with a range of vintages from 2004 to 2013 represented.

    Several odd-lots circulated during the session split between legacy names and CMBS 3.0 bonds, with legacy super seniors ending the day about 1bp wider, according .......

    Market Reports 11 December 2013

  • Major market recovery boosts CRE prices

    The recovery in major markets boosted the recovery in national commercial real estate prices to within 11% of the December 2007 peak, according to the latest Moody's/RCA CPPI report. Major markets recouped roughly 95% of their peak-to-trough decline, while national prices have recovered almost 75% of their peak-to-trough decline. Non-major markets recouped around 56% of their losses.

    The national all-property .......

    News Round-up 11 December 2013

  • Top trades touted

    Morgan Stanley suggests in its global securitised products outlook for 2014 that the market is on the verge of a major transition from being liquidity-driven to being growth-dependent. While the returns are more modest in this scenario than they have been in the past, strategists at the bank believe that alpha opportunities within the sector remain more significant, scalable and .......

    News 11 December 2013

  • Defeasance activity accelerating

    US CMBS defeasance activity accelerated to US$10.1bn by end-November - a 140% jump over the same period a year ago, according to Commercial Real Estate Finance Council (CREFC). The association suggests that this is due to multiple factors, including concern about increased rate volatility, the ongoing stabilisation of property values and the coming expectation of loan maturities.

    Many borrowers appear .......

    News Round-up 10 December 2013

  • Strong results seen for MBS funds

    Hedge fund returns rose by an average of 1.1% in November, boosting average year-to-date returns to 8.2%, according to the latest eVestment figures. On an annualised basis the industry is on pace to return 9% for the year, nearly 150bp ahead of 2012's 7.5% increase.

    With a 0.35% return, credit strategies lagged the industry's average returns in November, weighed down .......

    News Round-up 10 December 2013

  • CMBS pro becomes real estate head

    Christian Janssen has joined Henderson Global Investors in London as head of real estate debt. He was previously co-head of commercial real estate lending at Renshaw Bay.

    Janssen has also served as chairman of CREFC Europe and as head of CRE DCM for Europe at Jefferies. He has worked at Barclays Capital in London, Morgan Stanley in London and New .......

    Job Swaps 10 December 2013

  • CMBS surprises in store?

    Deutsche Bank CRE debt research analysts forecast that five scenarios could surprise the US CMBS market next year. These predictions are set against a backdrop of increased investor focus and improving performance across the sector, albeit with potentially disappointing absolute returns.

    The first surprise is the return of multi-billion dollar conduit CMBS, with the number of loans in each deal .......

    News 9 December 2013

  • Smaller balance loan transfers rise

    Fitch reports that smaller balance US CMBS loans are increasingly transferring to special servicing. So far this year, 647 loans in the agency's rated universe transferred to special servicing - approximately 100 more than for the same period last year, but by dollar volume the number has declined considerably (US$15.8bn YTD November 2012 versus US$7.5bn in 2013).

    Most transfers to .......

    News Round-up 9 December 2013

  • CMBS loss severities dip

    The weighted average loss severity for all loans backing US CMBS that liquidated at a loss was 41% in 3Q13, down from 41.5% in the previous quarter, according to Moody's. The weighted average loss severity for all liquidated loans excluding those with losses of less than 2% was 52.7%, down from 53.5% in the previous quarter. Loans with losses of .......

    News Round-up 6 December 2013

  • Pay-off percentage hits highs

    The percentage of US CMBS loans paying off on their balloon date hit 81.3% in November, the second highest rate since Trepp began tracking the number in August 2008. The highest reading was 84.9% in December 2008.

    The November pay-off percentage is well above the 12-month moving average of 66.1%. By loan count as opposed to balance, 79.1% of loans .......

    News Round-up 6 December 2013

  • Multifamily CMBS origination trending up

    Kroll Bond Rating Agency expects the US multifamily CMBS sector to continue benefitting from household formation and low homeownership. As long as multifamily fundamentals continue to outperform the rest of the commercial real estate market, both investors and lenders will feel comfortable expanding their allocations to the sector, the agency suggests.

    On the lending front, this trend has been evident .......

    News Round-up 6 December 2013

  • Minimal Euro default rate underlined

    Only 1.5% by original issuance volume of European structured finance notes outstanding in mid-2007 had defaulted by end-3Q13, according to S&P's latest quarterly transition study. The quarterly transition study analyses cumulative rating transitions and defaults from the beginning of the financial downturn - which is assumed to be mid-2007 - until end 3Q13, aggregating by issuance volume.

    "The 12-month rolling .......

    News Round-up 6 December 2013

  • CMBS unresolved

    Euro CMBS questions unanswered as maturities loom

    S&P announced this week that over €10bn of loans backing European CMBS transactions that it rates could need refinancing next year (SCI 3 December). About €3bn of the €13bn of loans scheduled to mature in 2014 has been prepaid, with sizable question marks hanging over many of the transactions that are approaching maturity.

    Although loan maturities will continue to come .......

    News Analysis 6 December 2013

  • CRE CDOs tipped for growth

    US CMBS financing will expand on 2013 levels, according to Fitch's 2014 Outlook report for the sector.

    The agency notes that mortgage interest rates have increased rapidly from their early 2013 lows and, while the outlook on interest rates is largely benign in 2014, the expectation is that they will continue to rise slowly. That may impact the ability of .......

    News Round-up 5 December 2013

  • Euro CMBS performance to stabilise

    Weak European CMBS performance is set to stabilise in 2014 on improving market fundamentals, says Moody's. The rating agency's outlook on the sector also predicts bolstered commercial real estate values, although significant losses are expected on legacy deals over the next five years.

    Secondary property values are expected to stabilise and loans backed by prime properties should perform strongly in .......

    News Round-up 5 December 2013

  • Divergent Euro rating outlook

    Fitch's rating outlook for European structured finance (SF) transactions is geographically split. Almost 70% of ratings in the core European countries are predominantly stable, with the remainder related to transactions from the eurozone periphery, which are predominantly negative.

    The negative outlooks for the eurozone periphery reflect a combination of declining asset performance, uncertainty over timing and extent of recoveries, policy .......

    News Round-up 5 December 2013

  • CMBS servicer names new ceo

    Hatfield Philips International has appointed Blair Lewis as ceo, effective from next month. He has 17 years of experience in structured finance and joins from RBS.

    Lewis was head of structuring and origination for Europe at RBS and also served as corporate director for global banking and markets. He previously worked at ABN Amro as well as in various positions .......

    Job Swaps 5 December 2013

  • Real estate group targets MENA

    Carlton Group has hired Edwin McClendon to lead its new Middle East and North Africa unit. He is based in Dubai and has over 30 years of experience in real estate and investment banking, including as ceo of McClendon, Morrison & Partners.

    McClendon has particular experience of senior credit facilities and mezzanine financings. He will work with vp Chase Chehade, .......

    Job Swaps 4 December 2013

  • Pulled loans augur bondholder risk

    The removal of loans from two recent US CMBS could be an early warning sign of risk for bondholders, Fitch notes. The agency suggests that borrowers' eagerness to lock in historically low interest rates and originators' enthusiasm to maintain volumes are putting pressure on securitisations to come to market quickly, raising the risk of errors in loan oversight.

    Recently a .......

    News Round-up 4 December 2013

  • Resolutions drive delinquency decline

    The Trepp US CMBS delinquency rate continued its impressive turnaround in November, which marked the sixth consecutive month of improvement. With a decrease of 32bp, the delinquency rate now stands at 7.66%.

    Last month's rate decrease was driven by almost US$1.2bn in previously delinquent loans being resolved with losses. By removing these delinquent loans from Trepp's numerator, the rate saw .......

    News Round-up 4 December 2013
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