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Course Details

This program will discuss the opportunities and challenges in the current distressed commercial mortgage-backed securities (CMBS) market. The panel will explore the current market conditions and trends and provide guidance for navigating complex loan restructurings and strategic asset management from the perspective of both borrowers and lenders.

Faculty

Description

With the wave of CMBS loans coming due, a dramatic increase in the special servicing rate, and a spike in delinquency rates, the CMBS market is showing signs of significant distress. Despite this distress, the CMBS issuance rate remains strong. These market conditions have created both challenges and opportunities for borrowers, lenders, and investors

In the current market, when a CMBS loan misses its maturity date, many lenders and borrowers have engaged in loan modifications, extensions, or even foreclosure. The most common resolution has been a loan extension to grant the borrower temporary relief in hopes that their financial situation will improve. An extension also allows a lender to potentially delay big losses. However, loan extensions are adding stress to an already distressed market because the balance of unresolved debt continues to grow. 

Counsel for lenders and borrowers must carefully consider the ramifications of loan modifications and extensions in conjunction with other economic factors such as rising interest rates and declining property values which have left some borrowers in a negative equity position. 

Listen as our authoritative panel discusses the current state of the CMBS market and evolving trends and provides strategies for both borrowers and lenders to prepare and respond to distressed loans.

Outline

I. Overview: the evolution of the CMBS market

II. Current CMBS market conditions and trends: surge in distressed loans accompanied by a rise in CMBS issuance

III. Sectors experiencing the greatest amount of distress vs. sectors that are rebounding

IV. Actions lenders and borrowers should take now to respond to distressed loans in the future

V. Loan restructuring and asset management strategies from the perspective of both borrowers and lenders

VI. Challenges and opportunities

VII. Predictions for the CMBS market in 2026 and beyond: trends and developments to watch out for

VIII. Practitioner pointers

Benefits

The panel will address these and other key considerations:

  • What are the current and evolving CMBS market conditions?
  • What sectors are experiencing the greatest amount of distress?
  • How have loan extensions contributed to the distressed CMBS market?
  • In what ways have workout/modification strategies changed over the last year to accommodate the number of distressed loans?