Specialty Interest Group Discussion Board

[Mr. Thomas Curtin, CRE]

Great discussion about CRE financing and equity investing in today’s market environment. Thanks for joining…… please post your comments on the session.

[Mr. Thomas Fink, JD, CRE]

Thanks for kicking this off, Tom.
It was great sharing the forum yesterday. There are many changes yet to come in the utilization and value of real estate, based on the changes wrought by the COVID pandemic.
I think a large, looming question will be the future of office:
– How does CBD office recover if remote work becomes a norm?
– Does suburban office become more attractive?
– Will there be a difference between markets which rely on automobiles, and those which rely on mass-transit?

[Mr. Thomas Fink, JD, CRE]

Update on losses for May, 2020, from TreppTalk

The Five Largest CMBS Loan Losses from May 2020
By Kelvin Lin, Fri, Jun 05, 2020
CMBS disposition activity rose in May with a 122% month-over-month increase in volume compared to April. In total, $212.5 million in CMBS debt across 15 notes were resolved with a combined loss of $146.9 million and an average loan size of $14.2 million.
Overall loss severity edged up for the second consecutive month, rising to 69.12% in May, while the 12-month moving average rate increased to 63.49%.
Read more »

[Mr. Thomas Fink, JD, CRE]

When comparing loss rates for CMBS to other lenders, remember, that missed interest gets recovered before principal, whether in the form of servicer advances or shortfall recoveries.

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