CMBS Loan Defaults Hit 9.5%

GlobeStreet-NEW YORK CITY-With a 133-basis point rise in the cumulative default rate for CMBS during the second quarter, predictions of an 11% to 12% rate of securitized loans in arrears come closer to reality. Fitch Ratings says 9.48% of the fixed-rate conduit CMBS loans in its universe were in default at the end of Q2, while Realpoint said in late July that $3.11 billion of unpaid loans were...

Distressed CMBS Loans Now Returning Less Than Half Their Note Value

Declining Property Values Indicate Loss Severities Will Go Higher By Mark Heschmeyer June 9, 2010 The amount of losses on distressed CMBS loans resolved in the past year has jumped 33% to where noteholders are now recovering approximately 43 cents on the dollar. And, say analysts, the losses are expected to continue to mount this year.   Read Full...

Vornado vs. Cerberus: LNR, Round 2

Cerberus Capital Management LP has found a way to possibly salvage its investment in real-estate company LNR Property Corp. But it will have to share ownership with an old adversary. Vornado Realty Trust, which lost to Cerberus in a bidding battle for LNR in 2004, is poised to get a stake in LNR along with other creditors as part of efforts by Cerberus to restructure the real-estate...

For CMBS, ‘Worst Is Yet to Come’

By LINGLING WEI-WSJ In 2007, at the height of the commercial real-estate boom, Credit Suisse Group packaged 250 mortgages into bonds and sold them to investors in a $3.3 billion issue of commercial-mo rtgage-backed securities. That CMBS issue has now achieved a dubious distinction: The deal is expected to see a 15% loss, the highest potential loss for any 2007 CMBS issue, according to Fitch...

CMBS Special Servicers Get Creative as Volume Increases

  Murray, Michael Commercial mortgage-backed securities special servicers Nearly 5,000 loans in special servicing rapidly increased workload and staff. “Special servicers are now engaging in bulk note sales, modifications into A/B notes and forbearance,” said Stephanie Petosa, managing director at Fitch. “However, the majority of the loan workouts remain within the more...