SLIPPING AWAY

Moody?s director of CRE research Tad Philipp, who authored the firm's CMBS Q3 ?11 Review released on Friday, says that CMBS credit quality has been slipping. In the meantime, LTV and the amount of interest-only loans are rising. The problem: if a loan isn't paid down during its term, it's more difficult to refi when it comes due. He and his team will continue to watch this trend as competition among lenders heats up and underwriting standards slip. Tad expects to see a few more CMBS deals before the end of this year but says volume will drop off early next year as economic uncertainty and the European debt troubles rear their heads.

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