CMBS

  • At-risk Macy's eyed

    About US$3.64bn in loans securitised in CMBS issued since 2010 could be impaired by Macy's recently announced round of store closures, according to Morningstar Credit Ratings. The agency has identified 28 Macy's locations that reported below-average tenant sales and are the most at risk of closing.

    The retailer said last week that it plans to shutter an additional 100 stores .......

    News Round-up 18 August 2016

  • Retention span

    CMBS compliance window closing

    The race to originate and structure US CMBS is reaching a critical stage, with the implementation of risk retention rules just over four months away. The recent issuance of the US$870.6m WFCM 2016-BNK1 kick-started a new era for the asset class, marking the first retention-compliant deal and precipitating a positive market reaction.

    WFCM 2016-BNK1 sees sponsors Wells Fargo, Bank of .......

    News Analysis 18 August 2016

  • CMBS trader charged for loan fraud

    The US SEC has charged former CMBS trader Tianyu Zhou with inaccurately marking certain loans held on his employer's books prior to securitisation. Zhou has agreed to settle the SEC's charges, while his former firm - Deutsche Bank - was not charged as it cooperated with the SEC's investigation.

    The SEC says that Zhou - who worked at his firm from 2012 .......

    Job Swaps 16 August 2016

  • Executive director tapped

    The CRE Finance Council has named Lisa Pendergast executive director. The association says this latest appointment is a significant step in the restructuring of its management team, following the hire of Michael Flood as deputy executive director (SCI 11 May).

    Pendergast brings to CREFC 25 years of industry experience in structured finance markets. Most recently, she was md and head .......

    Job Swaps 15 August 2016

  • Delinquencies inch up

    US CMBS delinquencies increased by 2bp in July to 3.20% from 3.18% a month earlier, according to Fitch's latest index results for the sector. The portfolio run-off of US$7.6bn exceeded Fitch-rated new issuance volume of US$4.1bn from four transactions in June, causing a decrease in the overall index denominator.

    In terms of loan count, 76 loans were resolved in July, .......

    News Round-up 15 August 2016

  • CMLS 2014-1 affirmed after wildfires

    Fitch has affirmed all rated tranches of Canadian CMBS CMLS Issuer Corp series 2014-1, including the class G notes, which have been removed from rating watch negative. The rating action reflects the overall stable performance of the pool, in addition to the Clearwater Suites property becoming fully operational after the Fort McMurray, Alberta area was evacuated due to wildfires in .......

    News Round-up 12 August 2016

  • Euro default rate up

    The 12-month rolling loan maturity default rate for the European CMBS in S&P's rated universe increased to 11.9% from 7.3% at the end of July. The delinquency rate for continental European senior loans increased to 59.6% from 58.4%, while the rate for the UK increased to 21.8% from 19.6%. Overall, the senior loan delinquency rate increased to 46.1% from 44.6%.

    .......

    News Round-up 12 August 2016

  • Investment property underwriting eyed

    Investment property mortgages underwritten to property cashflows pose unique risks relative to similar loans underwritten to borrower personal income, Moody's notes. However, the agency adds that they also have distinct potential strengths.

    Some lenders are originating mortgages secured by individual single-family rental (SFR) properties using underwriting based on mortgage payments relative to property-level rental incomes - property debt-to-income ratios - .......

    News Round-up 10 August 2016

  • CRE secondary markets ranked

    Austin, Texas is ranked top MSA in a recent Trepp study of US CRE secondary markets. Out of the markets measured by the data firm, Austin provides the lowest unemployment rate and highest average DSCR.

    Denver, Colorado came second in the study, as the market generated the highest growth in CMBS originations and third-highest net operating income (NOI) growth for area .......

    News Round-up 10 August 2016

  • Hotels raise CMBS concerns

    The days of strong RevPAR growth and occupancy rates are over for US hotels, says Fitch. This could impair loan performance for CMBS as interest rates rise.

    Fitch maintains a favourable outlook for the hotel sector, but the rating agency believes demand has peaked and several key industry metrics could turn negative by 2018. "We are now at the top .......

    News Round-up 9 August 2016

  • Sustainability affecting leasing decisions

    Sustainability is becoming an increasingly important factor in the leasing decisions of US office building tenants, which in turn has made it an increasingly important factor in assessing the credit quality of the office collateral that backs commercial mortgage loans, Moody's reports. The agency says that 'green' building features are credit positive for US CMBS backed by those loans, as .......

    News Round-up 9 August 2016

  • Pay-offs continue to decline

    The percentage of US CMBS loans that paid off on their balloon date last month dropped to 55.6%, over five points lower than the June level, according to Trepp. This marks the fourth straight month that the rate has declined and is the lowest reading since last December.

    The July tally is below the 12-month moving average of 67.0%. By .......

    News Round-up 9 August 2016

  • Maturity wall diminishing

    Approximately US$23bn of Fitch's US CMBS fixed-rate loan universe is still scheduled to mature during 2H16, excluding loans that have already been defeased, with an additional US$61bn in 2017. The remaining 2016 maturities include US$8bn in Q3 and US$15bn in Q4. At the same time last year, however, US$54bn was scheduled to mature in 2016 and US$69bn in 2017.

    Among .......

    News Round-up 8 August 2016

  • Specially serviced loans increase

    Moody's reports the share of specially serviced US conduit CMBS loans increased by 82bp to 6.86% in 2Q16 from 6.04% the previous quarter. However, this share remains 586bp below the April 2011 peak of 12.72%.

    The share of delinquent loans rose to 4.6% from 4.4% the prior quarter too. Moody's commercial mortgage metrics weighted average base expected loss consequently rose to 4.6% .......

    News Round-up 5 August 2016

  • Spanish NPL portfolios purchased

    Bain Capital has acquired three Spanish NPL portfolios for €1.15bn, extending the firm's holdings to six Spanish portfolios. The purchases include a €415m pool from Banco Sabadell, which comprises defaulted first-lien bilateral Spanish loans to real estate developers, primarily secured on residential and commercial real estate assets.

    The largest purchase is a €511m portfolio from Grupo Cooperativo Cajamar, which holds .......

    News Round-up 4 August 2016

  • CMBS delinquencies move up again

    Trepp's US CMBS delinquency rate moved higher for the fifth straight month in July to 4.76%, an increase of 16bp from June. The rate is now 61bp above its multi-year low of 4.15%, which was reached in February of this year.

    In July, CMBS loans that were previously delinquent but paid off with a loss or at par totalled about .......

    News Round-up 3 August 2016

  • Brexit CRE impact gauged

    The UK's vote to leave the EU will be negative for the country's CRE market and, subsequently, UK CMBS transactions, reports Moody's. UK CRE values could decline by up to 10%, depending on the property type, quality and location.

    The figure is estimated by the agency from a base case scenario with a new UK-EU trade agreement and UK GDP growth .......

    News Round-up 3 August 2016

  • Loss risk improves for GSE CRTs

    Expected mortgage losses on seasoned GSE CRT transactions are trending positively, says Fitch. The loss projections are driven by strong loan performance to date, a shorter loss exposure window until deal maturity and steady home price growth.

    Coupled with bond deleveraging, the improvement in projected pool losses has resulted in positive rating momentum for the rated classes. Fitch has upgraded .......

    News Round-up 2 August 2016

  • Watershed US CMBS deal prepped

    The first CMBS to include a retained interest intended to meet the definition of an eligible vertical interest under US risk retention rules has hit the pipeline. The US$870.6m WFCM 2016-BNK1 will be issued with sponsors Wells Fargo, Bank of America Merrill Lynch and Morgan Stanley retaining a combined 5% vertical slice in the deal.

    US risk retention rules come .......

    News Round-up 2 August 2016

  • Hastings closures pose risks

    The beginning of Hastings Entertainment's store closures are not expected to pose a major risk to CMBS, but 19 loans still pose some unwanted exposure, according to Morningstar Credit Ratings. This batch of small loans come to a balance of US$253.9m, with only one exceeding US$19m.

    Although the impact is not expected to be profound, Hastings is a large tenant .......

    News Round-up 1 August 2016

  • CMBS 2.0 maturity defaults spike

    US CMBS 2.0 loans saw a substantial rise in maturity defaults during the first half of 2016, reports Fitch. Across the 2010-2016 vintages, 32 loans totalling US$302.1m defaulted, which is up from just eight loans totalling US$69m during the same stretch the previous year.

    The increase was driven by loans with exposure to oil and gas, including properties in Houston. There was also .......

    News Round-up 1 August 2016
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