LEVEL DAYS

There was a dramatic increase in loans moved to special servicing since ‘08, peaking and leveling off in ‘10. The leveling—now at 211loans worth $7B, according to the most recent Trepp data—is a combination of several trends, including resolution or restructuringof loans, continued flow of loans into special servicing, and improvements in the capital markets, says FTI Schonbraun McCann Group senior managing director Paul Griesmer, whose firm has assisted both special servicers and borrowers in resolving loans for hotel, office, and retail properties.
Paul (at a Bisnow distressed assets panel discussion in '09) says that the improving market is to thank for allowing certain loans to be refinanced or recapitalized. Others have been resolved through restructurings, extensions, paydowns, or discounted payoffs. With alarge wave of maturities anticipated over the next five years, the future trend of loans in special servicing depends on the strength of the economic recovery and the continued improvement and strength of the real estate capital markets.

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