Locating CMBS Loans

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Locating CMBS Loans

Post by rooter » Fri Nov 05, 2010 7:57 am

My understanding is that all aspects of publicly traded CMBS issues should be public information. I am looking for larger CMBS loans (>$10m) for sale which are underperforming or distressed. Seems to me that transfer to a special servicer may indicate that a loan is or may be underperforming and that it may soon be cleaved from the securitized issue. (although lately this may be being done as a defensive measure by the borrower?)

So where would one find this information? The goal is to locate larger loans, which are collateralized by commercial real estate, which are underperforming and which may be for sale.

Also, I believe that some CMBS issues are fully in private portfolios such as banks. Is there any way to locate larger distressed commercial loans in these issues? I've thought about driving around to identify empty buildings, but my gosh...

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REIT Wrecks
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Re: Locating CMBS Loans

Post by REIT Wrecks » Mon Nov 08, 2010 11:38 pm

My understanding is that all aspects of publicly traded CMBS issues should be public information
That may be more of a desire than anything else, because all aspects of publicly traded CMBS issues are simply not public. Subcribing to Trepp, a providerof CMBS loan-level data, is probably your best option, as they update loans based on servicing status each month, but they do not provide the granular level of detail you would need to submit an offer to the servicer or an investor. Another option would be a lower priced subscription to cmbs.com. Either way, you'll need to know your market and asset type cold, and there's just no substitute for rolling up your sleeves and going to work.

My experience is that special servicers will not sell in a negotiated transaction. Most often, they will put the loan out to bid through a broker and make buyers slug it out in an auction. This way they know they are getting the best price available in the market.

If you want to find CMBS loans to buy, the intermediaries they hire most often for loan sales (prior to foreclosure) are, in rough descending order:

Mission Capital
CBRE National Loan Sale Advisory Group
First Financial Network (FDIC receiverships)
Carlton Exchange

If you really want to buy defaulted loans though, you'll need to slug it out with everyone else. My advice is to avoid the loan sales maket and go fee simple in secondary and tertiary markets. See:

1. [url=http://reitwrecks.com/2009/05/why-fdic-loan-sales-giveaways-arent.html]FDIC Loan Sales: The Good, the Bad and the Ugly[/url]
2. [url=http://reitwrecks.com/2009/07/distressed-commercial-real-estate.html]Billions, Literally, Chasing Distressed Commercial Real Estate[/url]
3. [url=http://reitwrecks.com/2010/11/commercial-real-estate-where-the-new-normal-is-old-hat.html]Commercial Real Estate: Where the New Normal is Old Hat[/url]

Good luck and let us know how you make out.

Cheers, RW

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Re: Locating CMBS Loans

Post by LeeShane » Sat Nov 20, 2010 12:08 am

A dearth of financing alternatives is available to refinance properties and pay off maturing loans.
1. When a business or person revises their payment schedule for repaying debt.
2. Replacing an older loan with a new loan offering better terms.
When a business refinances they typically extend the maturity date. CMBS servicing involves multiple parties and bifurcated.

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Re: Locating CMBS Loans

Post by crabsofsteel » Sat Nov 20, 2010 7:46 am

I'll just add that cmbs.com lets you see the loans in CMBS deals without any paid subscription. It's quite handy, actually.

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Re: Locating CMBS Loans

Post by crabsofsteel » Fri Dec 24, 2010 4:31 pm

One other thing to correct a misperception in an earlier comment: data on public deals are in fact public. You can find offering documents on the SEC website if you know the name of a deal (most names begin with the name of the underwriter,e.g. Lehman). I think the form for the prospectus is 424B5. Loans are listed within, or the loan tape may have been filed as a separate annex. However, data on private placements is only available through one of the analytic services. E.g. all floating rate CMBS deals are private. The size of the public CMBS market dwarfs the private placement sector, so the original poster should find plenty of loans to look at. To see current performance, anyone can register with one of the trustees (mostly Lasalle and Wells Fargo) to get monthly remittance reports, which include data on loans in special servicing.

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Re: Locating CMBS Loans

Post by orjaboureyas » Sat Mar 16, 2019 4:28 am


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