2013

This week, over a thousand industry participants made their way through a rain soaked Manhattan for the start of CREFC’s Annual Conference. The low hum of attendees taking conference calls in corners and tapping messages on iphones provided a constant auditory backdrop to the event and aptly conveyed the velocity of the CMBS industry in 2013. The market is back to work.Continue Reading Stormy Skies Greet Sunny Outlook at CREFC 2013

Mortgage Resolution Partners (“MRP”), a San Francisco-based venture-capital firm, continues to actively market its proposal to assist homeowners with underwater performing mortgage loans held in private label securitization by having such loans seized, refinanced, or restructured and sold to third party investors, with the government recovering the administration costs and MRP earning a fee on each transaction (the “Program”). For additional background information on MRP and the Program see here, here and here.Continue Reading Dechert’s OnPoint: Underwater Mortgages Deserve More than Eminent Domain

Next week, hundreds of industry participants will make their way to New York for CREFC’s Annual Conference.

The conference promises to provide a forum to explore present and future market trends in commercial real estate, as well as an opportunity to gain valuable insight from many leaders in the market as to where we are and where we are headed. With panels such as “Lend-sanity: Competition Between Balance Sheet and Conduit Lenders” and “Borrowers: Is it their Game Now?”, it is clear there is no shortage of activity in commercial real estate, and there shouldn’t be any shortage of interest in this forum. The conference’s keynote address will come from Blackstone’s Global Head of Real Estate, Jonathon Gray, who will be sure to offer a unique viewpoint of the current and future landscape of real estate investments. Continue Reading CREFC Returns to the Big Apple

There’s a lot of talk these days about the growth of a shadow banking market. Shadow is right! The growth of the commercial lending market outside of the universe of insured depository institutions and life insurance companies is real and its growth is accelerating, yet it is not easy to discern its size, shape and taxonomy. The shadow banking market, which simply means the community of lenders outside of the bank and lifeco cadres, is a logical response to a worldwide tsunami of regulatory activity designed to constrain innumerable facets of financial institutions’ operations which often seems more about retribution than the safety, soundness or integrity of the financial markets life.Continue Reading The Shadow Banking Market: The Shadow Knows

As we have discussed numerous times in this blog (here, here, here and here), the downturn in the commercial real estate market resulted in much litigation as to guarantor liability for non-recourse debt. As a brief refresher, many of the non-recourse loans made during the CMBS boom included an agreement that, in an event of default, the lender would only exercise remedies against the property securing the loan and not against the borrower (or its principals or sponsors), with an exception for certain borrower “bad-acts” (such as misappropriation of rents, fraud, and in certain instances, borrower bankruptcy or insolvency). In the event the borrower perpetuated any of these bad acts, the guarantor agreed to be liable either for the losses incurred by the lender, or for the full amount of the loan, depending on the bad act committed.Continue Reading On Appeal: The Michigan Court of Appeals Overturns It’s Prior Ruling and Affirms the State’s 2012 Legislation, Nonrecourse Mortgage Loan Act, Which Invalidates Recourse Carveout Guaranties Triggered by Borrower Insolvency

A recent decision of the New York state appellate court has given hotel owners a new way to override contract provisions in long-term property management agreements and oust hotel managers from managing the property. In Marriott Int’l, Inc., et al. v. Eden Roc, LLLP, 104 A.D.3d 583 (N.Y. App. Div. 2013), the appellate court vacated a lower court’s imposition of an injunction requiring Eden Roc, LLLP (“Eden Roc”), the hotel owner, to allow Renaissance Hotel Management Company, LLC (“Renaissance”), the (now former) hotel manager and subsidiary of Marriott International Inc. (“Marriott”), to perform its role as manager of the hotel in accordance with the management agreement.Continue Reading Ace in the Hole: NY Court Gives Hotel Owner New Way to Oust Hotel Manager and (Re)Claim Management of the Property

I was entertaining myself early this morning by looking over a joint agency report just released entitled “An Analysis of the Impact of the Commercial Real Estate Concentration Guidance”. This report summarizes the performance of bank CRE portfolios following the issuance of interagency guidance in 2006 entitled “Concentrations in Commercial Real Estate Lending, Sound Risk Management Practices”. Everyone will be shocked, shocked to know that through the course of the worst recession in post-war history, banks lost money because of commercial real estate exposure and many smaller and regional banks went casters up. Well, there’s startling news. We taxpayers pay for this sort of thing. Where is the sequester when we really need it?Continue Reading Undue Commercial Real Estate Risks Are Bad: The Mathematical Proof of the Blindingly Obvious

The Miami Heat’s home playoff games are not going to be the only events drawing attention to sunny Miami next week as IMN hosts its annual REO-to-Rental Forum in Miami. As we have previously discussed numerous times (here, here and here, and OnPoint Updates here and here), the REO-to-Rental asset class has become quite a hot topic and this conference is sure to provide invaluable insight into current trends in the market, as well as where market participants see this class of assets going over the near- and far-term.Continue Reading IMN’s REO-to-Rental Forum 2013: Welcome to Miami

The second annual IMN CLO and Leveraged Loan Conference returned to New York this past week. Building on last year’s momentum (discussed here), over 1,500 managers and investors, in addition to structurers, bankers, lawyers and other industry actors, filled the convention space at the Conrad Hotel, doubling last year’s attendance and causing standing room only conditions in the large downtown venue. Yes, many conference attendees were literally prevented by conference staff from entering the fully packed Conrad ballrooms.Continue Reading Second Annual IMN CLO and Leveraged Loan Conference Update