| Holliday Fenoglio Fowler?s Greg LaBine says that special servicers have modified more loans than they've liquidated and when they do sell them, the average loss has been 54% per loan from January '09 through March ?11. Ouch. So, there's more can kicking than underlying problem resolution. Of the $2.9T in total CRE debt, banks hold the largest share (60%) followed by CMBS (20%) with insurers, REITs and Fannie/Freddie splitting the rest. In '10, 18% of all property sales were distressed properties compared to almost none in ?07 prior to the financial crisis. Of the $1.6T in bank loans, since '09, $300B was in distress with $120B worked out and $178B left troubled. Problem properties are concentrated in the Southeast and Southwest with hotel debt taking the biggest hit. These numbers tells us there are still lots of problems for lenders … and opportunities for investors. (This is the closest we can come to a cliffhanger.) |
KICKING THE CAN
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Greg LaBine, Holliday Fenoglio Fowler
