DRA/Colonial ($742mm) receives extension modification

Barclays put out a loan report today on this loan, which is has pari passu pieces in three CMBS deals. The mod is a positive for investors as it doesn't change the rate, doesn't reduce interest cash flow, and requires deposits, and some effort to sell properties and pay down principal. The extension is for two years, with an additional year possible but dependent on a 50% principal reduction from sales (new max extension = July 2017).

Five Mile completes Red Roof Inn acquisition

Barclays noted in their weekly today that it completed on August 25th via a $700mm debt acquisition. They are still forecasting a 50 (reported sales price) - 60% (Barclay's high end estimate) loss severity, to be reflected in September's remits.

Red Roof Inn - 48% Loss Severity

That could have been way worse.... Barclays reported today that this month's remit for CGCMT 2008-C7 reflected a 48% loss severity, hitting the J tranche on that deal.

See our prior thoughts here.




And, btw, I'm back - Apparently everything wasn't really 'better' in CRE-land like they told me...

Red Roof Inn Defaults

Accor (owner of Motel 6) sold RRI for $1.3 billion back in 2007 to Citigroup's Global Special Situations Group (GSSG), Westmont Hospitality Group ("Westmont"), and Westbridge Hospitality Fund, and partially financed that with 2 pari passu loans spread across 4 CMBS deals totaling $366 million. The rest of the senior mortgage ($655mm) didn't make it into a CMBS, and is likely on Citi or Bear's books, but it's not clear, and there is also some mezz debt ($164mm). That put's the new owners' equity at about 8 or 9 % of the purchase price. See the WSJ article for more.

The CMBS loans:
CGM RRI Hotel Portfolio - CD 2007-CD5 and CGCMT 2008-C7, 52 properties, $103mm

RRI Hotel Portfolio - BSCMS 2007-PW17 and BSCMS 2007-PW18, 79 properties, $263mm

UPDATE: Corrected the ownership structure.