Category Archives: Commercial Mortgage Finance

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A Tale of Two Years; This Time Will Be Different

The Wall Street Journal reminded us this month that it was ten years ago, August 9, 2007, that the first regulatory domino in The Great Recession fell as BNP Paribas froze a series of resi investment funds for lack of a functioning market to value the securities. One could quibble about whether The Great Recession could … Continue Reading

The Dilemma of the Really Annoyed Borrower

Since my earliest days in the CRE capital markets biz, there has always been a drumbeat of grumbling from the borrower community about the annoying complexity, expense and delay of having one’s loan serviced in a capital markets transaction.  It’s been going on forever.  Like noise, like listening to Brits complaining about their weather; it’s … Continue Reading

Observations from SFIG Vegas 2017 Conference

SFIG Vegas 2017, which took place last week at Aria Resort & Casino, was the largest capital markets conference in the world, according to the Structured Finance Industry Group. With over 6,300 registered attendees, and I suspect thousands more who came to Vegas to attend meetings without registering for the conference, it’s hard to imagine … Continue Reading

New Year! New Administration! Same EB-5 Dilemma!

Since 2015, we here at Crunched Credit have tracked, followed and discussed the developments (or lack thereof) concerning the Immigration Investor Program, more commonly known as the “EB-5 Visa Program.” Throughout the past year, we’ve witnessed the approval of several extensions of the EB-5 Visa Program and in each instance, no substantive changes were included—these … Continue Reading

Substantive Consolidation: It’s Alive and Well (or Maybe Just Alive)

The doctrine of substantive consolidation (generally- the power of a bankruptcy court to consolidate the assets and liabilities of affiliated entities in bankruptcy) is a recognized remedy exercised by bankruptcy courts – one that strikes fear into the hearts of many lenders. Justifiably so. The doctrine can be employed to order the substantive consolidation of … Continue Reading

Risk Retention and the CRE CLO

As we are just inking one of the very first pre-risk retention effective date risk retention deals (Potemkin Village anyone?), we are also seeing an increased flow of what are generically referred to as CRE CLOs. It’s time to consider how the Risk Retention Rule (the “Rule”) will apply to this growing market technology.… Continue Reading

A Report From the Risk Retention Front-Lines

Your correspondent is fresh from the front-lines of the risk retention wars where great armies of lawyers, bankers and advisers are fixedly staring at each other, staring out of the redoubts of their respective defensive crouches in a complex, multidimensional chess game.  All are fervently hoping against hope that something or someone does something to … Continue Reading

Why Regulation Fails

I’d like everyone to go out and buy a copy of Professor Paul Mahoney’s slender new book, Wasting a Crisis – Why Securities Regulation Fails.  Paul is a brilliant guy.  Until this spring, he was the dean of the University of Virginia School of Law where he is the David and Mary Harrison Distinguished Professor … Continue Reading

Coming to a Hotel Near You: The Starwood-Marriott Merger

It seems fitting that Marriott’s upcoming acquisition of Starwood Hotels & Resorts (creating one of the largest hotel companies in the world) is anticipated to occur during the prime summer vacation season.  The combined company will be comprised of more than 5,500 hotels and 30 brands.  By way of comparison, Hilton is comprised of over … Continue Reading

A Trip Through the Labyrinth – The Regulatory Man in Full

And now to return to our commentary a few weeks back about the stultifying impact of ill-thought through rules and regulations (at best) (Brexit has intervened).  This is our Regulatory State which broadly attempted to pick winners and losers and modify market behavior, to get an engineered outcome by using the blunderbuss of proscriptive rules … Continue Reading

CREFC Annual Conference 2016: Headwinds or Head First Into the Wall?

The slow start to 2016 did not dampen the enthusiasm at CREFC’s Annual Conference, held last week in New York City.  The conference saw record attendance, with standing-room-only crowds at virtually every panel.  As with the Industry Leaders Conference in January, the hot topics on people’s minds were risk retention (and the rest of the … Continue Reading

The Strange Death of the Modern Financial System

With apologies to George Dangerfield, who published The Strange Death of Liberal England in 1935 chronicling the collapse of the British Liberal Party prior to World War I, I’m borrowing his title for this commentary.  Okay, bear with me.  Regrettably, we may be witnessing something happening to our banking system which is somewhat reminiscent of … Continue Reading

Risk Retention: It’s the Fourth Quarter and the Home Team is Getting Glum

We thought it would be useful to give a quick, interim update on the slow-motion train wreck that is our industry’s response to the upcoming effectiveness of the Risk Retention Rule.  For those of you who have been blessedly snoozing under a rock these past couple of years, the Risk Retention Rule becomes effective on … Continue Reading

CREFC Commercial Real Estate Finance Summit (West) 2016

Earlier this month CREFC held its “Commercial Real Estate Finance Summit – West” in Santa Monica, CA, which – while not nearly as large as the annual conference in New York – was still very well attended (roughly 175 attendees, an increase over last year). Given the sentiment earlier this year in Miami, the fluctuation … Continue Reading

A Contrarian View on the Single-Family Rental Market

More than two years after the first single-family rental securitization, the single-family rental market continues to evolve and grow. The rise of single-family rentals reflects both a demographic shift among the American population and a reactionary change in consumer habits resulting from the financial crises. According to U.S. Census Bureau, the percentage of Americans that … Continue Reading

Observations from ABS Vegas: The CLO Perspective

Over the past few years, the ABS Vegas conference has been the place for industry participants to congratulate each other on a job well done (most recently on a record-setting 2015 for CLO primary issuance), meet-and-greet with clients and generally unwind, making sure to sprinkle a few “important” meetings across the three-day span.  However, following … Continue Reading

Flash: Congress Fixes the CMBS Risk Retention Problem (Just Kidding)

Last week, the House Committee on Financial Services reported out the Preserving Access to CRE Capital Act of 2016 (the “bill”) in a remarkably bipartisan sort of way (paving the way for: “Well, yes, I did vote for it, but then I voted against it.”).  The bill, which was drafted and backed by CREFC, would … Continue Reading

CREFC and MBA/CREF: A Hitchhiker’s Guide to Alternate Universes

That whole alternate universe thing, the conceit of so many sci-fi novels, is clearly not merely the product of fevered minds.  It’s real.  Or, at least it seemed awfully real after having been at the CREFC meeting in Miami and the MBA/CREF meeting in Orlando during the past month.… Continue Reading

If Interesting and Prosperous is a Choice, I’ll Take Door Number Two: Perspectives on 2016

As we do each year at Crunched Credit, we take the end of a calendar year as an opportunity to stop and reflect on where we are, and what the next year might hold. Recognizing the certainty that a successful prediction is more a random event – a blind cat finding a dead mouse, than … Continue Reading

With Its End in Sight, EB-5 Survives!

In an uninteresting turn of events last week, Congress has passed the Omnibus Bill, which contained a provision extending the EB-5 program until September 30, 2016, with no other changes to the program. As previously discussed, the last couple of months have been filled with substantial discussions and the introduction of potential legislation aimed at … Continue Reading

The Death of EB-5 Has Been Greatly Exaggerated

Earlier this year we discussed the uncertain future of the EB-5 Visa Program, one of the most successful inbound investment programs of recent years, as evidenced by the $5.2 billion dollars the program has generated in the past ten years alone. Although the EB-5 Visa Program was set to expire on September 30, 2015, Congress … Continue Reading

The Regulatory State: May We Have A Little Humility, Please?

The Great Equity Correction of 2015 that is now being enjoyed by all of us is a correction, and not the beginning, of the Great Bear Market of 2015 (from my lips to God’s ears). It reminds me of just how little we know about how all complex systems, like the global financial market (and … Continue Reading

MERS: Better Than a Faster Horse

MERSCORP, Inc. (“MERS”) has been under fire for years. We wrote about it a while back when residential mortgage borrowers challenged the ability of MERS to foreclose on mortgages it held on the theory that MERS, as a mere nominee to the lender, was not a real party in interest.  More recently, local recording offices … Continue Reading
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