CMBS

  • 'Unsustainable' rents eyed

    Moody's suggests that soaring apartment rents in Williston, North Dakota, are unsustainable in the wake of the energy boom. An analysis undertaken by the agency indicates that rents will ultimately normalise at far lower levels.

    "The energy production boom in western North Dakota has led to a rapid rise in population and a significant shortage of apartments. As a result, .......

    News Round-up 5 March 2014

  • CMBS spreads sneak tighter

    US CMBS BWIC volume was steady yesterday at around US$233m as spreads tightened. A considerable chunk of that supply was accounted for by the US$116.358m MLCFC 2007-7 AJ bond.

    SCI's PriceABS data shows that the MLCFC 2007-7 AJ tranche was talked during the session in the mid/high-40s. A much smaller piece of the tranche was covered .......

    Market Reports 5 March 2014

  • Titan NHP sale makes sense

    The noteholder dispute over Mount Street's replacement of Capita as the special servicer for Titan Europe 2007-1 (NHP) (see SCI's CMBS loan events database) is diverting attention away from the more pressing issue that capital expenditure is not adding significant value. Selling the portfolio now rather than waiting for valuations to increase appears to make more sense.

    HC-One .......

    News 4 March 2014

  • Patient investors 'rewarded' by ESA outcome

    Extended Stay America's successful IPO last November paves the way for other CMBS-backed companies to follow suit, according to Talmage ceo Edward Shugrue in the latest issue of CREFC's 'CRE Finance World'. ESA shares were priced at US$20 - nearly double its value when the firm was bought out of bankruptcy in 2010.

    From 2004 through 2008, 75% of the .......

    News Round-up 4 March 2014

  • CMBS credit creep examined

    As many as 10 new conduit lending programmes could be added to the list of US CMBS originators in the coming months, potentially bringing the total to 371, Kroll Bond Rating Agency notes. While issuance is expected to grow by 15%-20% this year, it is unclear whether the increase in volume can support the new entrants. The rating agency therefore .......

    News Round-up 4 March 2014

  • Legacy repayment rate to remain low

    Moody's expects the performance of loans backing European CMBS to stabilise over the next three years. CRE lending will likely remain constrained, however.

    "In line with our previous expectations, the outlook for commercial real estate markets has rebounded somewhat after the recent period of financial stress and the euro-area crisis," says Oliver Moldenhauer, a vp-senior analyst in Moody's structured finance .......

    News Round-up 3 March 2014

  • Fee 'blind spots' examined

    Weak EMEA CMBS transaction documentation governing work-out costs and liquidation fees can lead to note shortfalls, even where no securitised loans suffer a loss, Fitch notes. The agency says that, in some cases, misalignment of loan- and issuer-level documentation can leave blind spots regarding the bearer of fees.

    Charging the borrower for work-out costs ensures that equity fully bears the .......

    News Round-up 3 March 2014

  • Chinese CMBS prepped

    Dynasty Property Investment is prepping its second cross-border CMBS. Dubbed China Real Estate Asset Mortgages, the US$290m transaction is backed by nine retail properties in nine cities across China.

    The deal comprises US$232m class A notes (provisionally rated Aa3 by Moody's) and US$58m class Bs (A3), as well as an unrated CNH440m class C loan. The rating assigned to the .......

    News Round-up 3 March 2014

  • Delinquencies down on CWCAM sales

    The Trepp US CMBS delinquency rate decreased by 47bp to 6.78% in February, marking the ninth straight month of improvement. The rate is 264bp lower than it was a year ago and 356bp lower than the all-time peak during the summer of 2012.

    The decrease is attributed to the jump in loan resolutions, driven by the CWCapital distressed asset sales. .......

    News Round-up 3 March 2014

  • SFR operational risk highlighted

    S&P says it is yet to see a single-family rental (SFR) securitisation with the level of credit enhancement and other risk-mitigating features that warrant the highest investment grade rating. The agency's primary reservations regarding the sector revolve around the industry's operational infancy, historical performance, the current business model's ability to withstand extreme economic conditions and the ultimate liquidation values of .......

    News Round-up 28 February 2014

  • Liquidation volume doubles

    US CMBS liquidation volume doubled in February, due in large part to many of CWCapital's REO asset sales flowing through remittance reports. Liquidation volume ended this month at US$2.65bn, more than double January's volume and the 12-month moving average of US$1.33bn, according to Trepp.

    February loss severity came in at 45.59%, down from January's 58.51% and on par with the .......

    News Round-up 28 February 2014

  • CLO relief in sight?

    The US House Committee on Financial Services held a hearing yesterday on the impact of the Dodd-Frank Act on ABS. Witnesses included representatives from the LSTA, Georgetown University Law Center, Center for Capital Markets Competitiveness, CRE Finance Council and SFIG.

    Testimony addressed Representative Barr's draft legislation on CLOs and Volcker - which calls for grandfathering of all CLOs issued before .......

    News Round-up 27 February 2014

  • CWCapital liquidation trends emerging

    A number of trends have become apparent for the loans liquidated in CWCapital's bulk sale (SCI passim). Proceeds have generally been higher than appraisals - on average by 13% - and loss severities are coming in at around 50%.

    Barclays Capital CMBS analysts estimate that US$1.9bn of the US$3.2bn of loans placed for bid in auctions sent liquidation proceeds to .......

    News 26 February 2014

  • Steady state for US CMBS secondary

    Generic US CMBS spreads were mostly unchanged yesterday with BWIC volume of around US$270m. SCI's PriceABS data reveals a few tranches from 2013 as well as names from the more commonly seen 2006 and 2007 vintages out for the bid.

    CD 2006-CD3 C was talked in the high-50s and at around 69 but did not trade. .......

    Market Reports 25 February 2014

  • CMBX 3 correction issued

    Markit has issued a correction in connection with a loss recoupment on the CWCI 2006-C1 D tranche that wasn't reflected in January's CMBX.A.3 index settlements (SCI 23 January). A US$7,400 correction payment will now be made on US$1m original face trades.

    The failure to reflect the loss reimbursement is believed to be due to the trustee reporting the payment as .......

    News Round-up 25 February 2014

  • TRACE reprieve for CDOs, CMBS

    FINRA will exclude CDOs, CBOs, CLOs and non-agency CMBS from its proposal to expand TRACE's coverage of securitised products (SCI 5 November 2013). The move comes after SIFMA submitted a comment letter on the proposal to the SEC (SCI 9 January).

    Specifically, CDOs, CBOs, CLOs and non-agency CMBS will not be classified as 'asset-backed securities' (as defined in proposed FINRA .......

    News Round-up 25 February 2014

  • CWCAM recoveries confirmed

    CWCapital Asset Management reports that it has liquidated 110 of the 134 assets marketed via CBRE and Auction.com, with 12 further assets expected to close by mid-March (SCI passim). It is projected that overall recoveries averaging 66 cents on the dollar of US$3.43bn unpaid principal balance will be achieved through the bulk sale.

    The assets that were marketed through CBRE .......

    News Round-up 24 February 2014

  • Surge in SFR issuance anticipated

    US home rental securitisation issuance is predicted to hit US$5bn this year. The increasing cost of homeownership is driving the need for rental housing and institutional investors appear to be responding to the demand.

    The rise in renter households has outpaced ownership by a factor of 10, according to Deutsche Bank CRE debt strategist Harris Trifon. He notes in a .......

    News Round-up 21 February 2014

  • TITN 2007-CT1 losses to reach Bs

    Mixed loan-level developments for the pan-European CMBS Cornerstone Titan 2007-1 suggest that principal losses could reach the class B notes, according to Barclays Capital CMBS analysts. The A2 class has become most senior tranche, increasing the risk of a note EOD and further complicating class B losses.

    The transaction balance has reduced from its initial €1.3bn to €483.8m, as of .......

    News 21 February 2014

  • Credit fund redemptions persist

    Investors allocated an estimated US$4.9bn to hedge funds last month, but performance losses of US$12.8bn resulted in total industry AUM declining by 0.3% to US$2.845trn, according to eVestment figures. At the same time, MBS strategies continued to lose assets: January was the sixth month of net redemptions for the sector in the last eight.

    Nevertheless, performance from the group was .......

    News Round-up 20 February 2014

  • Trafford Centre CMBS tapped

    Intu Properties has tapped its Trafford Centre Finance CMBS, with the launch of £110m additional class A, B and D notes. The proceeds will be used to provide funds for the firm's pipeline of active management projects and major extensions.

    The transaction is secured by intu Trafford Centre, the prime super-regional shopping centre near Manchester. The notes, which have an .......

    News Round-up 20 February 2014
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