CRE Debt

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The tranching and splicing of debt secured by commercial real estate (CRE) is likely to become an increasingly important part of the CRE lending market as it begins to grapple with the sobering reality of a breaking wave of refinancings coupled with a serious deterioration in valuations.Continue Reading Tranching of debt is critical for the breaking wave of CRE refinancings

As was the case prior to the global financial crisis, the current driver for all new European CMBS deals stems from the adoption by investment banks of the originate-to-distribute business model for financing commercial real estate assets. This trend is showing no sign of abating in the CMBS 2.0 era. Although this is a proven and effective mechanism for producing much needed CMBS product, it is important for market participants to be aware that these conduit deals are not the only CMBS structures in the market and that agency deals could potentially be an invaluable tool for any sophisticated borrower that is looking to directly tap the capital markets to raise cheaper finance.
Continue Reading Agency CMBS – is now the time for borrowers to capitalise?

Read time: 2 minutes 45 seconds

Thus far CMBS has had a storming year and all current indicators point towards 2018 being a bumper year for the product.  After two years of relative malaise on the primary issuance front, the first half of 2018 has proven to be anything but sluggish.  Notable transactions that have so far taken place include Citibank and Morgan Stanley ‎closing an extremely well priced transaction secured by Finnish assets (a CMBS 2.0 first), Bank of America Merrill Lynch achieving some hugely impressive pricing on an Italian CMBS and most recently the spotlight has turned to Goldman Sachs who have recently obtained excellent pricing on a £427m CMBS secured by a portfolio of UK hotels.  The market though has not simply been confined to conduit deals as demonstrated by the fact that Blackstone successfully closed CMBS Pietra Nera Uno (which is apparently the first of a swathe of Agency CMBS deals that Blackstone are expected to bring to the market) and the recent market rumours that Natwest are currently in the midst of structuring a synthetic CMBS.  Taken together all these transactions provide the firmest indicator yet that that the beleaguered CMBS product is firmly back in vogue.
Continue Reading The European CMBS market is positively booming!

Read time: 2 minutes 15 seconds

Rather like the Hans Christian Anderson story about the little match girl, the news that BAML has successfully launched two CMBS deals in quick succession has flickered light into an otherwise cold and beleaguered primary issuance market.  Not only do these transactions provide a clear indicator that there is still life in the market, but this news is the most positive development for the industry since the summer of 2015, when adverse macro-economic factors precipitated by concerns over Grexit and the Chinese financial crisis shut down primary CMBS issuance.
Continue Reading CMBS – the little match girl of European ABS

Read time: 2 minutes 30 seconds

The recent news that Blackstone and Lone Star have just securitized a portfolio of re-performing loans secured by Spanish and Irish real estate respectively, could potentially mark the arrival of a new era for the European securitization market. Indeed, if these transactions prove themselves to be the green shoots for the emergence of a new fixed income product, then this has the potential to have widespread positive ramifications for not only yield hungry fixed income investors but also for those banks that have balance sheets saddled with large volumes of non-performing loans (NPL).
Continue Reading NPL securitisation and the trail blazing funds

This summer, fans of the non-performing loan (NPL) circus, are in for a treat with the launch of the Italian tightrope trick.

Spurred on by the recent European Banking Authority stress tests, the news last week that Banca Popolare di Bari will become the first bank to utilise the Italian state guarantee scheme and deploy…

Fuelled by continued macro-economic uncertainty, the European CMBS market is currently experiencing a prolonged period of malaise. Meanwhile the Italian legislative cogs have continued to turn. The news last week that the Italian government has finally approved a decree on NPL securitisations, which comes hot off the heels of the proposals to establish a private…