NEW YORK--(BUSINESS WIRE)--Link to Fitch Ratings' Report: U.S. CMBS Special Servicing Update: A Slowly Decreasing Loan Population
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=690222
Another sign of a potential turnaround in U.S. commercial real estate is the declining number of CMBS loans in special servicing, according to Fitch Ratings in a new report.
After reaching a high-water mark of $92 billion in June 2010, special servicers continue to work out underperforming loans. The balance fell to $80.5 billion through June of this year.
Loans are also spending more time in special servicing. The number of months in special servicing has increased to over 18 months as of June 2012. This represents a notable change from just under 11 months as of June 2010.
'After a large number of CMBS loans were worked out last year, special servicers are now grappling with the more challenging assets that will take longer to resolve,' said Managing Director Stephanie Petosa. 'These loans are usually larger, complicated loans which often are not the best candidates for liquidation.'
This is leaving the smaller CMBS loans as the most likely candidates to be liquidated, a trend that Fitch expects to continue. Out of the $105.5 billion resolved since 2010, less than half by balance (46%) have been liquidated. A closer look shows that by count the number of liquidated loans is substantially larger (71% of the 7,074 loans have been liquidated).
'U.S. CMBS Special Servicing Update: A Slowly Decreasing Loan Population' is available at 'www.fitchratings.com' or by clicking on the above link.
Additional information is available at 'www.fitchratings.com'.
ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE 'WWW.FITCHRATINGS.COM'. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE.