Agency New Issues

Ginnie and Freddie were out with deals this week:

GNR 2011-10

Cl	Size (MM)	WAL	Cpn	Window	Pricing	$Px
A	$ 100.00	3.34	5.08	2/11- 3/23
AB	$ 90.00	2.11	2.52	2/11- 2/15	N+65	101-00
AC	$ 115.00	3.96	7.08	2/15- 3/23
B	$ 14.00	3.96	12.93	3/23-11/23	N+105	93-0
Z	$ 17.20	3.962	18.59	11/24- 4/53
IO	$ 319.00	0.718	5.42	2/11- 3/49

-JP and Wells

FREMF 2011-K10

Cl	Size (MM)	WAL	Cpn	Window	Pricing	$Px
A1	$ 313.82	5.48	3.32	1-113	n+70	100.9977
A2	$ 695.00	9.58	4.333	113-116	n+80	100.9939
B	$ 64.47	9.71		116-116

BAML

Hot Downtown Nashville/Miami Offices For Sale

LNR is foreclosing on the Concourse Towers in Miami and the Regions Center in Nashville, collateral for the $70mm FRI Portfolio mortgage in BACM 2005-3.

There had been forbearance negotiations in place a few months ago, but the loan matured in May 2010 and the properties were subsequently jointly appraised at just $36.025mm.

The troubles are two fold. In Nashville an attorney vacated roughly a quarter of the space. The servicer notes indicate that there was some potential for Regions to take that space themselves and another tenant that was interested in 225k sf, but it's not clear if either happened. The DSCR as-is is 0.92x - This sounds like a good fixer-upper for someone.

In Miami, Colonial Bank occupied 8.73% of that property. It wasn't really clear what the status was though based on some cursory googling.

Comings and Goings

Mark Heschmeyer, who I'm a big fan of, has some good highlights in his co-star column.

• New Freddie deal
• American Assets Trust raises $563.75mm (looks like they paid 8 points for the money though)
• Cole RE Investments raises $315mm senior unsecured credit facility via BOA, JP, USBank, and RBS
• First Potomac raised $100mm in preferred equity

Loans are getting done - again, please see Mark's column for more.

• Kilroy ($135mm @ 4.27% 7 year, on a SanFran property),
• ARC acquired and financed Snow View Plaza and Lakeside Plaza,
  
• $6mm CTL on a Walgreens in Medford OR (24.6years, amortizing, 6.15%, 88% LTV)
• $5mm Walgreens in Raleigh NC (10/30, 6.253% coupon, 66.4% LTV)
• Thomas D Wood secured $4.5mm for a shopping center bank loan at 1mL+335 and a 0% LTV.
• Thomas D Wood secured $3mm for a shopping center. Fully amortizing with a 15 year term and a 6.25% rate.

In other news, there's a glitch in the housing market in Brooklyn and Queens with sales dropping 29.9% and 41.7%, respectively in the 4th quarter. Prices continued to drop throughout the year as well, down 8.4% citywide - Massey Knakal expects further declines.

At the same time, CRE sales are expected to continue to strengthen in the Manhattan market in CBRE's opinion.


Calendar:

Innkeeper's USA Update

Bloomberg reports (sorry, no link) that the 72-hotel Apollo-owned Innkeepers portfolio has a new bankruptcy proposal filed pushing for control by Five Mile and Lehman. This follows the prior proposal which was ultimately blocked by Midland, one of the Specials because, at least in part, it resulted in the sponsor retaining an equity position.

The current plan focuses on the preferred equity holders retaining an interest in the 5 hotels that are not in CMBS deals and proposes an auction to see if there is a better bid from the market on the portfolio.

Comings and Goings

• In new issue we have snow, snow, and more snow. I heard one report this morning on the radio that every state except Florida had snow on the ground - even Hawaii!

• In all seriousness, the mainstream media and sell-side research continues to kick out articles on the new issue resurgence expected in 2011 in CMBS. See here, here, and here.

• Trepp came out last week noting that delinquencies were at an all-time high at 9.2%.

• 245 Fifth is on the market looking for a $170mm transaction price, and they'll probably get it given the upside in rents that is going to start being realized immediately as rent-free periods ended in late-2010 and rolling leases are below current market rates. The 310k sq ft office building is in CSMC 2007-C4 with a $140mm senior mortgage, 95% occupancy, 1.05x NCF DSCR, and a declining $2mm reserve balance (down from $3.6mm in April 2010). Citibank occupies 15% of NRA, Datamonitor has 9%, and Beth Israel Medical has 5% (had free rent through the end of 2010!). The mortgage is due on 5/11/2012.
  

Calendar:

CMBS Issuance to pick up steam in 2011

Nothing new here, but always good to see CMBS in the TOP news on Bloomberg.

Deutsche Bank and UBS are teaming up to issue as much as $2.5 billion in commercial mortgage-backed securities linked to loans on office buildings, shopping malls and hotels in what would be the largest offering of its kind since the market froze in June 2008, according to a person familiar with the deal. JPMorgan plans to sell $1.5 billion in similar debt, a person familiar with that sale said.

CIC Increases US CRE Investments

This transaction is actually a few months old, but the story is running the theme over the last several days of vast foreign interest in US CRE investments:

“CIC is very bullish on investing in real estate in the U.S.,” as are major Chinese banks, Jeffrey Lenobel, chairman of the real estate group at the New York law firm Schulte Roth & Zabel LLP, said in a telephone interview. “There is every reason to think you will see them together more often.” ...

CIC acquired a 7.6 percent stake in General Growth Properties Inc. in November through a fund manager that participated in the bankruptcy reorganization for the second- largest U.S. mall owner. A CIC subsidiary holds a controlling stake in Beijing’s Bank of China Ltd., which agreed in November to lend investors $800 million to refinance an office building on Manhattan’s Park Avenue.

“CIC has always wanted to get into the overseas real estate market and they are looking for opportunities in big cities,” said Paul Lin, a Beijing-based director of research for Knight Frank. “CIC is very powerful but it won’t be very aggressive. I don’t think it’s aiming to take over half of Manhattan.”

Comings and Goings

AAA spreads still tightening while credit inching wider.

A new article is out about CMBS refinancing activity and maturity schedules. Although I generally agree that there are CMBS loans coming due this year, and the largest are the most likely to have a chance of refinancing, I disagree that it will be as hard as some think (recent experience tells me loans aren't that hard to come by even on smaller properties with a little hair on them). Also, I refer the author to the real big maturity wave coming to us from bank balance sheets:



Bank of America closed a deal to buy back $3 billion in resi paper from Fannie/Freddie on the last day of 2010. Does anyone know the real story here, not the WSJ version? Are a bunch of POs about to pay off early? Were these on the balance sheets of the Enterprises? Are they all in default, or does it include performing loans that might not have been underwritten to conforming standards?

Worldwide investors apparently ranked the US as the #1 spot to put there CRE dollars to work.

UK minister comments that too much regulation could 'snuff out innovation'. Reminds me of 2002 in Georgia when representatives passed new "predatory lending" laws on October 1st, and on October 2nd half the states lenders shuttered their operations leading to a dearth of available credit to homeowners (the laws effectively allowed a borrower to sue up to the investor level in an RMBS deal that had a loan in it that was in violation - in other words, your pension fund was on the hook for reps and warranties made by an illicit broker). Whether that was a good or a bad thing may be up for debate, but the law was quickly repealed and subprime lending resumed just a few short months later.



I'm not making any defined resolutions for 2011, but there are going to be some changes coming to the blog. Over the weekend I looked over this site's stats and there are several thousand hits each month, and about a dozen different countries with readers in a typical month. We never started this with the intent to attract readers, it was more to keep track of our own thoughts - in fact, if I'd realized how many readers there were I might have been somewhat less blasé in many of my comments. Further, we deleted a large number of posts due to potential compliance issues with a, now former, employer, which was unfortunate.

So, on that note, please make a comment if there is something in particular you'd like to see more or less of, and we'll see what we can do. Don't count on us cleaning up our language or formalizing our style (sourcing is for sell-side research teams!), but I'd like to post more of what folks are interested in.

Go Team 2011!

Comings and Goings

This regular update has become quite irregular, but there has been somewhat of a lull in action now that "everything is better and prices can only go up" again...

-Aegon said it will start contributing loans to BAML deal.

-Barclays is updating the Lehman Agg with a CMBS 2.0 group of indices meant to reflect the post-crash CMBS issuance.

-Are things better or worse? It depends on who you ask:

1. Ratings Downgrades slowed at the end of 2010 (S&P) - they include RMBS in the report too.
   
2. Moody's downgrades Billions of CMBS. (However, the author of this one also describes the downgraded transactions as "structures where the bookrunner is passing through mortgage payments to investors")
   

-Trepp had some comments out last week regarding the risk surrounding front-pays now that they are mostly trading above par while at the same time loans are being worked out more quickly resulting in some unexpectedly fast pay-downs, and losses to investors. They highlight the CSFB 2005-C2 WAMU Irvine Campus loan (Maguire) that was recently modified with a 45% write down, wiping out classes up into the G class. That same deal also has a $142mm Tri-County Mall Loan that is expected to further wipe out classes up into the C class. They go on to highlight the Springfield Mall ($156.9mm), which is expected to get sold at just $42mm (to its current owner, Vornado. It appraised in January 2010 at $31mm). Springfield Mall was split equally between CMAT 1999-C1 and NASC 1998-D6.

-Freddie Mac is reportedly planning to double it's K series issuance to more than $10 billion in 2011. K10 is expected in the first quarter, expected average size to be $1.2billion, 50-80 mortgages, include a B class. (source: Real Estate Finance & Investment; no link)

353 N. Clark trades at $320 psf

From Globe St.:

Tishman Speyer has completed the acquisition of 353 N. Clark for $385 million, about $35 million less than it cost seller Mesirow Financial to build the tower that was finished in October 2009. Mesirow had owed roughly $374 million from construction loans that were coming due.
...

Tishman is making inroads into investing in Chicago, already owning One North Franklin, 161 N. Clark, 10 & 30 South Wacker, the Civic Opera Building and 30 N LaSalle. The company is the largest owner in the city of Class A buildings, said Casey Wold, senior managing director with the company. “This property is a great addition to our world-class office portfolio and the acquisition demonstrates our confidence in the Chicago market,” he said in a statement Wednesday.

GSMS 2010-C2 (876.45MM) *Launch*

Tranche	M/F	Size ($mm)	WAL	Subordination		Launch
A1	Aaa/AAA	347	4.87			+130
A2	Aaa/AAA	376.072	9.84	17.50%		+140
B	Aa2/AA	26.293	9.95	14.50%		+195
C	A2/A	29.58	9.95	11.13%		+265
D	Baa3/BBB-	47.11	9.95	5.75%		+380
E	Ba2/BB	12.051	9.95	4.38%
F	B2/B	9.86	9.95	3.25%
G	NR	28.485	9.95	0.00%

Seniors are a little wider than talk, subs are on the tight end.

1225 Connecticut Ave NW trades @ $900 PSF

Brookfield sold 1225 Connecticut Ave. NW to The World Bank for $900 psf last week, the highest price ever paid in DC according to several news outlets (sorry can't confirm - but it was in the news, so it must be true).

This building was bought by Brookfield and Blackstone as part of the 2006 Trizec transaction and serves as collateral in COMM 2007-FL14 and MLFT 2006-1, along with other properties. They immediately began a $32mm renovation which was mostly completed in 2008, but finalized in 2009, and signed The World Bank as the sole tenant of the 240,000 square feet in 2008.

Jones Lang LaSalle took the property to market several months ago, but The World Bank has had an option to buy it that originated with the 2008 lease. Also, the CMBS loan matured in 10/2008, and the fully extended maturity is now 10/11/2011.

Someone made money - both deals saw some LCF and front-pays trade recently.

Two California Plaza - Update your models to "PENDING MODIFICATION"

Located in the heart of the U.S.'s former subprime operations headquarters (#3 tenant was Aames), Two California Plaza ($470mm senior in GSMS 2007-GG10 representing 6.30% of the deal) long ago depleted debt service reserves and was coasting on cash from the sponsor (Maguire/MPG). As of the end of the first half of this year, it's NCF DSCR was at 0.92x with 84% occupancy - not horrible, considering, but most investors have been angling for this property to get modified.



Earlier today David Weinstein (MPG CEO) stated

Two California Plaza as part of its core set of assets, and expects to have the opportunity to explore various potential options for doing so once the asset is transferred into special servicing. At this time, we do not believe that funding current and projected operating deficits at this asset with the Company’s precious unrestricted cash is in the best interests of our stockholders.

It originally traded at the peak at a 5% cap rate, roughly. If you apply that same cap rate to today's cash flows, you get a value of $507mm, still above the senior. That is too optimistic a view, in my opinion, but it's not horribly off either for a trophy asset like this. A 6% cap rate dings the first mortgage.

The maturity date is not until 2017, and the coupon is 5.5%. Not clear on what type of modification they are after, but it is definitely headed that way.

GSMS 2010-C2 ($876.45mm) *TALK*

Heard the 7th multi-borrower deal of the year priced, but I haven't seen the final levels. I updated guidance below

Tranche	M/F	Size ($mm)	WAL	Subordination	Talk
A1	Aaa/AAA	347	4.87		+120-125
A2	Aaa/AAA	376.072	9.84	17.50%	+130-135
B	Aa2/AA	26.293	9.95	14.50%	+210-220
C	A2/A	29.58	9.95	11.13%	+280-290
D	Baa3/BBB-	47.11	9.95	5.75%	+380-390
E	Ba2/BB	12.051	9.95	4.38%
F	B2/B	9.86	9.95	3.25%
G	NR	28.485	9.95	0.00%

HUNDREDS of new leases coming to America!

That's a little tongue-in-cheek, but nonetheless, one of our favorite blogs Retail Traffic, has some interesting links on retailers that are actually adding stores in 2011:

Family Dollar has revealed it plans to double its annual store growth to 300 locations. Japanese apparel retailer Uniqlo reportedly wants to open 200 U.S.

Uniqlo is the retailer that took over the ground level retail at 666 Fifth Avenue for $20mm this past Spring.

Ceasar's $327mm deal?

I haven't seen it, but it was referenced in an article from DJs., which called it an "unrated senior mezzanine floating rate real-estate loan".

Ceasar's is the new name for Harrah's, which went through a big LBO for TPG and Apollo at the peak of the market. Ton of CMBS debt.

Who is buying legacy hotel debt right now at such low yields?

GSMS 2010-C2 ($876.45mm)

This deal got announced today. 43 loans, 108 properties, mostly retail & office, 59% average LTV. No talk yet.

Tranche	M/F	Size ($mm)	WAL	Subordination	Talk
A1	Aaa/AAA	347	4.87
A2	Aaa/AAA	376.072	9.84	17.50%
B	Aa2/AA	26.293	9.95	14.50%
C	A2/A	29.58	9.95	11.13%
D	Baa3/BBB-	47.11	9.95	5.75%
E	Ba2/BB	12.051	9.95	4.38%
F	B2/B	9.86	9.95	3.25%
G	NR	28.485	9.95	0.00%

Dwight's Norris sees further CMBS gains

I respect the guys at Dwight. That being said, I'm surprised that they're moving down the curve into AMs and AJs stating that the Super Senior trade is done. I'd argue the AM & AJ trade is about over too. AMs are being quoted in spreads now and all the decent ones are 90-above par. AJs seem to be priced pretty far up too. I'd even go so far to argue that the time to buy B - Ds is past, but the run-up is next year (hopefully)!

From Reuters:

Norris said Dwight -- which manages $64 billion in bonds -- is looking at slightly riskier CMBS known as "AM" and "AJ" classes, which have higher yields but less protection from loss. The risk spreads on those could contract another 1 to 1.5 percentage points, he said.

Dwight's portfolios already overweight with CMBS could expand their weightings to as much as 15 percent from about 9 percent, where prospectus allows, he said. Benchmark indexes have about 3 percent CMBS, he said.

I also disagree with their tenant review of Bob's Gun Shop in Texas as not being a desirable tenant - sounds like a perfect tenant for the upcoming revolution!

"There are also some properties that you want to stay away from," he added. "Maybe a mall in Midland, Texas, that's supported by Bob's gun shop."

Google offers to buy 111 8th Avenue for $1.9billion

This has a $500mm pari passu senior split up between GCCFC 2004-GG1, GSMS 2004-GG2, MSC 2004-IQ7, MSC 2005-HQ5, and GMACC 2004-C2. It was appraised at $800mm in '04. Current debt matures in April 2014 and carries a 5.78% coupon. It is not clear if they're assuming the debt or working out some new financing. Based on YE '09 numbers that represents a 4.1% cap rate (I realize the WSJ quoted some odd "yield" at the bottom, but I don't know what they're talking about - they don't either)


The WSJ reports:

Google occupies about 500,000 square feet in the building and earlier this fall was reported to be a front-runner in the bidding for the property. The company won partly because it knew the building well and was willing to close the deal before the end of the year, according to people familiar with the matter. While the deal could still fall apart, that is unlikely because the contract is binding and Google has put down a large deposit, these people said.

Americold 2010-A

Americold is financing their purchase of the VersaCold acquisition with a $600mm CMBS deal and $375mm of preferred equity. The loan is a 10-year (25 year am) collateralized by 50 fee-owned and 3 ground lease properties, 48.7% LTV, 16.6% debt yield, 2.34x DSCR, 4.85% rate (spread across 6 CMBS classes, floating/fixed, and subordinate).

Class	S/F/R	Size	WAL
A1	AAA/AAA/AAA	$158.68	5.52
A2FX	AAA/AAA/AAA	$148.83	10.08
A2FL	AAA/AAA/AAA	$87.50	10.08
B	AA/AA/AA	$60.00	10.08
C	A/A/A	$62.40	10.08
D	BBB-/BBB-/BBB-	$82.60	10.08

Americold also has two other large CMBS loans spread across multiple deals in pari passue notes - DB AmeriCold Portfolio is $350mm and is in CD 2007-CD4, JPMCC 2007-CB18, JPMCC 2007-LDPX, JPMCC 2007-CB19, and GECMC 2007-C1; AND THE CGM Americold Portfolio $325MM loan split between CD 2007-CD4 and CGCMT 2007-C6. The two legacy pari passu loans are performing fine looking at YE 2009 data with 2.34x DSCRs being reported on each. Also, they've been doing similarly structured CMBS loans since the late 90s with GS.

hat tip to "Anonymous" for pointing out this deal that I completely missed. Thanks!

CMBS for the Holidays

After gaining extensions on most of the GGP loans, exiting bankruptcy, and general perceived market improvement, GGP is now looking to ramp up refinancings. We've looked at positions on both ends of the capital stack as front and next pay bonds may shorten, and in the first case that we reviewed GGP passed on a loss to junior bond holders despite not losing any money themselves on Water Tower Place.

Bridger teamed up with New York Mortgage Trust and is offering mezzanine debt to CMBS borrowers - this would be a great business to be in right now.

Berkadia announced that it was going to lend out $200mm for CRE.

CMBS prices are a little overdone, but compared to this week 2008, they are reflecting risks much better. This happens to be the same week that I decided to start getting really long CMBS, in 2008, when we had high teen yields on front pay AAAs, but I'm a seller today.

I'm most thankful that electronic strip searches and groping by government employees has finally gotten a groundswell of opposition from the American public against the government not only stomping all over our rights as citizens, but treating us like criminals, and implementing costly procedures that do not appropriately address the problem. No, I'm not talking about the Fed, I'm talking about the TSA - but take your pick.

However, I also fully support women choosing to wear bikinis through the security lines and men wearing kilts, and I hope that more folks will be choosing these options to help entertain me as I travel in December. I'll be in planes more than all other vehicles combined next month and will be traveling 8 of the 31 days. If you could please click the donate button and ads I could fly private - help me help you. In a day when I can fly private for under $1k and get there faster and on my schedule, $200-$500 tickets and losing 2 - 4 hours of my time dealing with commercial airports is demonstratively less attractive.

BALL 2010-HLTN

Goldman's out, deal size is smaller, pricing today (maybe).

"Goldman may have simply decided the Libor plus 175 basis points investment was attractive for their own internal investment, whereas large banks are still in a loan exposure reduction mode," said Darrell Wheeler, senior managing director at Amherst Securities Group in New York.

...

"Not having a rating is fairly experimental and it was likely difficult to find investors for more than a billion of unrated paper," Wheeler said.

Dan Nigro, chief executive of Warfield Consultants, a Montclair, N.J., firm focused on asset-backed and residential mortgage-backed securities, thinks this bond is a precursor to other unrated bonds because the ratings agencies have been discredited during the past few years.

"There is an entire market that trades without ratings and there are enough people who can evaluate these bonds without needing ratings so there will be an evolution to a private market that will be largely unrated," he said.

When Special Servicer's Attack

At the bottom of the WSJ's article, Street Aims to Reboot CMBS, there was an interesting piece of news: CWCapital is denying Trimont any of the $19mm in fees related to the Extended Stay workout. Trimont was serving as the Special for about a year until investors voted to replace them with CWCapital. The WSJ article implies that CWCapital thinks that Special Servicing Fees are performance based with the following excerpt pulled from the court filings: "during the nearly one year that Trimont was the special servicer, it had no success working out the loan or resolving the bankruptcy case."

The article also talked about the Innskeeper loan dispute between LNR and Midland. I excerpted below so you can skip over the beginning of the article, which is wholly uninteresting, but CrabsOfSteel has reminded us all that it's sometimes worth reading threw the entire article for the good bits. h/t CrabsOfSteel.

That type of gamesmanship is highlighted in two recent lawsuits related to the bankruptcies of Innkeepers and Extended Stay. In the Innkeepers case, LNR Partners Inc. alleges in a lawsuit filed Oct. 27 in New York state Supreme Court that another investor reneged on an agreement to name LNR the special servicer overseeing Innkeepers' $825 million CMBS loan.

LNR alleges that it had a pact with CRES Investment, a division of Presidio Holdings II LLC, stipulating that CRES would hire LNR as special servicer if CRES's slice of the mortgage was deemed the controlling stake. As a side bet, LNR bought slices of the mortgage on its own to better its chances of getting the designation.

However, LNR claims in its lawsuit that CRES, once it was named controlling stakeholder, didn't hire LNR, instead keeping Midland Loan Services as special servicer. "CRES' failure to comply with its contractual obligations is depriving LNR of its bargained-for right to control workout and resolution of the Innkeepers loan," the lawsuit reads.

CRES representatives didn't return calls seeking comment. LNR declined to comment.

A similar dispute emerged in the Extended Stay bankruptcy. Trimont Real Estate Advisors Inc. alleges in a lawsuit filed Sept. 21 in U.S. District Court in Washington, D.C., that rival special servicer CWCapital Asset Management LLC owes it a portion of a $19 million restructuring fee. CWCapital received the fee as special servicer of Extended Stay's $4.1 billion securitized mortgage.

However, Trimont said it is entitled to some of the fee because it was the special servicer in the case for roughly a year.

Prior to a bankruptcy auction that resulted in a sale of Extended Stay and its 680 hotels, Trimont was abruptly replaced as special servicer with CWCapital by investors Bank of America Corp., UBS Securities and Cerberus Capital Management LP.

CWCapital has asked a judge to dismiss the case, noting in its court filing that "during the nearly one year that Trimont was the special servicer, it had no success working out the loan or resolving the bankruptcy case."

NCUA issues $3.8billion ReREMIC (NGN 2010-C1)

NCUA issued a $3.8 billion ReREMIC this week with 3 tranches with WALs from 4.00 - 6.73. All were rated AAA because NCUA wrapped them with their own guarantee for a monthly 2.9bp fee.

CMA reports Barclays was the lead.

The NCUA plans to conduct 8-10 resecuritizations totaling $35 billion, but all of the other deals will be backed by residential MBS. The first such offering, a $3.9 billion issue, priced Oct. 18.

After this week's offering, the agency still has about $560 million of CMBS from other failed credit unions. A spokesman said the NCUA doesn't plan to resecuritize them. While the agency didn't specify an exit strategy, it will presumably sell the remaining paper in the secondary market.

The CMBS resecuritization (NCUA Guaranteed Notes Trust, 2010-C1) is backed by bonds from the investment portfolios of Western Corporate Federal Credit Union and U.S. Central Corporate Federal Credit Union, which were seized last year.

Class	Size (mm)	WAL	Talk	Pricing
A1	$613.20	4.00	+70-75	+60
A2	$1,360.80	6.73	+110-115	+100
APT	$1,786.00	5.88	+105-110	+100

PCV/ST 6.67% loss projected by Appraisal

Not too shabby. Does this mean that the ASER will be that low? Probably not - they're still short 40% or so of the monthly debt service.

Delinquencies Improve in CMBS

Trepp notes that delinquencies improved 47 bps last month mostly due to the resolution of the ESH loan, which had been delinquent since '09.

Lodging improved 441 bps (ESH-reltaed), but all other sectors worsened:

• MF worsened 20bps
  

• Industrial - 21 bps

• Office - 6bps
• Retail - 4bps

Trepp also notes the rally ran out of steam late in October, which is very true. Lofty levels were being hit as late as the third week, but Monday of the last week found a back up in bids. Today started off mixed with the NAIC loss forecasts being adjusted downward.

WBCMT 2007-C33 - The Renaissance ($84mm)

CRENews reports (sorry no link) that Moinian is trying to restructure the terms on this $84mm loan. This was reported initially back in August, but there must be some increased velocity around the negotiations - any big NYC loan mod is going to be watched carefully for indications how others may be handled.

This is not a pure rent-control flip story, although they do receive the j21 tax abatement according to the servicer's notes. Average rents have gone from $2,645 per unit at issuance to ~$2,507 (I'm estimating), although occupancy has increased from 97% to 100%. Also, there is both a condominium and office component (the building was 100% office pre-1999) to the property on the first 13 floors. The property is located in the Financial District

The loan has a debt service reserve that has to be rebalanced on a yearly basis for a forward looking 1.10x DSCR. It also is currently secured by a hard-upfront lockbox. It was appraised on 5/13/2010 at $61.6mm (27% loss to senior, 47% decline from origination appraisal).

How the Elections Affect Retail Real Estate

David Bodamer ponders over the impacts of the elections on our world:

• Carried Interest tax hike less likely
• Gridlock in terms of legislative changes.
  
• Somewhat counter the prior point, less uncertainty with a Republican in terms of tax increases and pro-business measures
  
• Slot machines coming to Arundel Mills (BACM 2007-4 and BACM 2007-5)

In the near term, say 2-4 years, I foresee gridlock, uncertainty, and a lot of negative stuff. How can you make a business decision in this climate without being able to measure the political risk, which is arguably the most predominant risk in MBS markets.