Announcing BANK5 2024-5YR9

By

-

August 20, 2024

A CRED iQ Preliminary Analysis

DATA HEREIN PROVIDED TO CRED IQ IS FROM A PRELIMINARY PROSPECTUS AND MAY BE AMENDED OR SUPPLEMENTED PRIOR TO TIME OF SALE

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Deal Overview

The BANK5 2024-5YR9 CMBS deal is a new issuance securitization for the CMBS market, with a total pooled balance of approximately $910.2 million. The deal is jointly managed by prominent financial institutions JP Morgan, Morgan Stanley, and Wells Fargo, and collateralized by 33 loans secured by 44 properties across a variety of sectors, including retail, mixed use, office, and multifamily. The strategic geographic distribution of these properties ensures balanced exposure across major markets, thereby reducing regional risks and enhancing overall portfolio stability. The deal’s conservative underwriting practices are reflected in its weighted average loan-to-value (LTV) ratio of 57.2%, and the weighted average mortgage interest rate is 6.59%, which provides attractive returns for investors.

Key Metrics

The loan pool for BANK5 2024-5YR9 is meticulously structured to include a mix of amortizing and interest-only loans, with 16.1% of the mortgage pool having scheduled amortization, ensuring gradual principal repayment and enhanced cash flow stability. The remaining 83.9% of the pool consists of interest-only payments throughout the loan term, offering investors a steady income stream. The pool boasts a weighted average debt service coverage ratio (DSCR) of 1.65x, signifying strong cash flow relative to debt obligations and underscoring the financial robustness of the underlying properties. Moreover, the weighted average net operating income (NOI) debt yield of 11.8% highlights the high earning potential of the assets, further reinforced by rigorous underwriting standards.

Geography & Property Types

A key strength of the BANK5 2024-5YR9 CMBS deal is its diverse property type distribution, which enhances portfolio resilience. Retail properties, including anchored, super regional malls, unanchored, and single tenant properties, constitute 35.5% of the total balance, while mixed use properties account for 21.4% of the balance. The geographic distribution of the properties across prime markets, including high-growth areas in New York City, Houston, and Philadelphia further mitigates risk by reducing exposure to regional economic downturns.

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About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING OFFERED AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES IN ANY REGARDS WHATSOEVER, AND ACKNOWLEDGE THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

CRE CLO Distress Rates By Issuer – August 2024 Update

By

Michael Haas

-

August 16, 2024

0

Delinquency, Specially Serviced, Watchlist and Loan Modification Breakdown

CRED iQ’s research team revisited our quarterly CRE CLO rankings analysis this week. We explored aggregated data by issuer to uncover opportunities and risks within this closely watched sector.

With updated remittance data as of July 31, 2024, CRED iQ evaluated the Top 20 CRE CLO issuers and their performance. Our aim was to understand the percentage breakdown of delinquency and overall distress within these major CRE CLO issuers’ portfolios, and then measure the scale of those portfolios and their associated rankings within the group. We also wanted to explore the percentage of loans that were modified by each issuer. Some core measures of our study include:

Current Outstanding Deal Balance
CRE CLO Distress Rates
- Overall Distress (DQ and/or SS)
- Watchlist
- DQ
- SS
CRE CLO Modification Rates

CRED iQ notes that 10 of the 20 Issuers saw increased levels of overall distress, (including Fortress, Ready Capital, Varde Partners, Argentic, Starwood and MF1) while another 8 (including Greystone, Harbor Group, FS Rialto, ACRE, TPG and Prime) saw reduced distress percentages. Another two issuers remained flat over the period (Blackstone and KKR).

Fortress secured the top spot with 36.6 of their loans in distress. They also had the least amount of loans outstanding for the 20 largest issuers. Rounding out the top three, Granite Pointe and Ready Capital came in at 2^nd and 3^rd place with 29.8% and 27.5% respectively. From a ranking perspective, Harbor Group saw the most favorable movement (down) while Argentic moved up more slots than the other issuers.

Focusing in on delinquency, Fortress saw 31.3% of their loans were in a delinquent status –notching the number one slot in this category as well, Granite Pointe was not far behind at 28.0% and Varde Partners came in a more distant third with 18.4% of their loans being reported as delinquent.

The top 6 issuers based upon outstanding deal balances did not change over the reporting period. MF1 remains in the top spot, followed by Arbor, FS Rialto, Benefit Street Partners, Ready Capital and Bridge Investment Group.

For this analysis, we also wanted to explore the percentages of loans that were modified. In this category KKR dominated the group with a whopping 75.2% of its loans modified. Second and third place was a virtual tie between Arbor and Granite Pointe with 60.4% and 60.3% respectively.

Access Full CRE CLO Loan Level Data

Analysis Methodology

CRED iQ’s distress rate aggregates the two indicators of distress – delinquency rate and specially serviced rate – yielding the distress rate. The index includes any loan with a payment status of 30+ days delinquent or worse, any loan actively with the special servicer, and includes non-performing and performing loans that have failed to pay off at maturity.

It’s important to note that CRED iQ’s distress rate factors in all CMBS properties that are securitized in conduits and single-borrower large loan deal types. CRED iQ tracks Freddie Mac, Fannie Mae, Ginnie Mae, and CRE CLO loan metrics in separate analyses.

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

Announcing WFCM 2024-C63

By

Michael Haas

-

August 13, 2024

0

A CRED iQ Preliminary Analysis

DATA HEREIN PROVIDED TO CRED IQ IS FROM A PRELIMINARY PROSPECTUS AND MAY BE AMENDED OR SUPPLEMENTED PRIOR TO TIME OF SALE

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Deal Overview

The WFCM 2024-C63 CMBS transaction, with a pooled balance of approximately $713.96 million, represents a significant issuance in the commercial mortgage-backed securities market. The deal is backed by 30 loans, each secured by a diverse array of 30 properties across multiple sectors such as retail, multifamily, mixed-use, hospitality, and industrial. Wells Fargo Commercial Mortgage Securities Inc. is offering this issuance, designed to appeal to a broad spectrum of investors. The mortgage loan sellers, in order of contribution to the pool, include Wells Fargo, Argentic Real Estate Finance 2, JPMorgan Chase, National Cooperative Bank, Goldman Sachs, and Societe Generale, ensuring a strong backing for this offering.

Key Metrics

The loan pool for WFCM 2024-C63 is meticulously structured to include a mix of amortizing and interest-only loans, with 31.6% of the mortgage pool having scheduled amortization, ensuring gradual principal repayment and enhanced cash flow stability. The remaining 68.4% of the pool consists of interest-only payments throughout the loan term, offering investors a steady income stream. The pool boasts a weighted average debt service coverage ratio (DSCR) of 2.52x, signifying strong cash flow relative to debt obligations and underscoring the financial robustness of the underlying properties. Moreover, the weighted average net operating income (NOI) debt yield of 17.4% highlights the high earning potential of the assets, further reinforced by rigorous underwriting standards.

Geography & Top Assets

The WFCM 2024-C63 CMBS deal also emphasizes geographic and sectoral diversification as key strengths. The properties backing the loans are located in prime markets, including New York City, Dallas, and Riverside, ensuring exposure to dynamic economic environments. This geographic spread mitigates the impact of localized economic downturns, providing a buffer against regional market volatility. The deal also features robust credit enhancement through subordinate classes.

Access Loan Details

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals. With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

If you would like to learn more about CRED iQ’s products and services, please contact team@cred-iq.com or (215) 220-6776. You can also visit us at cred-iq.com.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING OFFERED AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES IN ANY REGARDS WHATSOEVER, AND ACKNOWLEDGE THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

Multifamily Distress Jumps 100 Basis Points in July

By

Michael Haas

-

August 9, 2024

0

CMBS Multifamily Continues a Staggering 2024 Distress Growth Rate from 2.6% to 8.4% in 2024

The overall CRED iQ distress rate added 17 basis points in July to 8.8%, the fifth straight record high. The CRED iQ team evaluated payment statuses reported for each loan, along with special servicing status as part of our monthly distress update. CRED iQ’s special servicing rate gained 10 basis points, while the CRED iQ delinquency rate fell 14 basis points to 6.14% in this print.

Segment Review

Multifamily built upon its 185% growth in its distress rate (as reported last month), added 100 basis points in July to 8.4%. Just seven months ago, that rate was 2.6%. The multifamily segment is now operating at the third highest level of stress among all CRE segments. These figures include all multifamily securitized with CMBS financing.

The office segment saw an increase in its distress rate in July – from 11.5% in the June print to 12.2% in July, taking over the lead from retail as the highest level of distress across all segments.

Retail notched a one basis point increase to 11.8% – settling into the number two slot. Both the industrial and hotel segments saw modest decreases in distress levels at 0.8% and 7.8% respectively. Self storage maintained its tight range –hovering near zero as it has all year.

Payment Status

Looking at distressed loan payment status, 21.2% of the loans are current – a reduction of 4 basis points from the July report. 1.1% of loans are attributable to Late (but in the grace period) and 5.7% of loans were Late (but less than 30 days DQ), although each saw reductions of 2 and 100 basis points, respectively.

Once again, the largest category was Non-Performing Matured at 39%–recording a second consecutive increase of 200 basis points, followed by 90+ Days Delinquent at 14.2% — flat to last month’s report, and Performing Matured at 12.9% vs.13.5% in June.

Analysis Methodology

CRED iQ’s distress rate aggregates the two indicators of distress – delinquency rate and specially serviced rate – yielding the distress rate. The index includes any loan with a payment status of 30+ days delinquent or worse, any loan actively with the special servicer, and includes non-performing and performing loans that have failed to pay off at maturity.

It’s important to note that CRED iQ’s distress rate factors in all CMBS properties that are securitized in conduits and single-borrower large loan deal types. CRED iQ tracks Freddie Mac, Fannie Mae, Ginnie Mae, and CRE CLO loan metrics in separate analyses.

As mentioned in our July report, our analysis exposes a meaningful gap between the distress and watchlist rates which could imply that the special serving & delinquency percentages may be likely to grow.

Loan Highlight

The 1.4 million SF Bank of America Plaza office property in Downtown Los Angeles is backed by a $400.0 million loan ($279/SF). The interest-only loan is one of four pari passu loans that are scheduled to mature in September 2024. Imminent maturity default led to the loan being transferred to special servicer in July 2024. The loan remains current in payment as of July 2024.

The CBD office tower was constructed in 1974 and renovated in 2009. The asset most recently performed with a DSCR of 2.26 and 79.5% occupancy. At underwriting in June 2014, the asset was valued at $605.0 million ($422/SF).

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About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

Announcing BBCMS 2024-C28

By

Michael Haas

-

August 6, 2024

0

A CRED iQ Preliminary Analysis

DATA HEREIN PROVIDED TO CRED IQ IS FROM A PRELIMINARY PROSPECTUS AND MAY BE AMENDED OR SUPPLEMENTED PRIOR TO TIME OF SALE

Access Loan Details

Deal Overview

The BBCMS 2024-C28 CMBS deal is an extensive new issuance in the commercial mortgage-backed securities market, with a total pooled balance of approximately $804.9 million. Jointly managed by prominent financial institutions such as Barclays, Deutsche Bank, Goldman Sachs, Societe Generale, UBS, and Wells Fargo, this deal encompasses 37 loans secured by 41 properties across a variety of sectors, including retail, hospitality, mixed use, and industrial. The strategic geographic distribution of these properties ensures balanced exposure across major markets, thereby reducing regional risks and enhancing overall portfolio stability. The deal’s conservative underwriting practices are reflected in its weighted average loan-to-value (LTV) ratio of 50.4%, and the weighted average mortgage interest rate is 6.54%, which provides attractive returns for investors.

Key Metrics

The loan pool for BBCMS 2024-C28 is meticulously structured to include a mix of amortizing and interest-only loans, with 21.0% of the mortgage pool having scheduled amortization, ensuring gradual principal repayment and enhanced cash flow stability. The remaining 79.0% of the pool consists of interest-only payments throughout the loan term, offering investors a steady income stream. The pool boasts a weighted average debt service coverage ratio (DSCR) of 2.07x, signifying strong cash flow relative to debt obligations and underscoring the financial robustness of the underlying properties. Moreover, the weighted average net operating income (NOI) debt yield of 14.5% highlights the high earning potential of the assets, further reinforced by rigorous underwriting standards. These metrics collectively illustrate the sound financial performance and low-risk profile of the deal, making it an attractive proposition for investors seeking stability and reliable returns in the CRE market.

Geography & Top Assets

The BBCMS 2024-C28 CMBS deal also emphasizes geographic and sectoral diversification as key strengths. The properties backing the loans are strategically located in prime markets, including high-growth areas in Chicago, Jacksonville, and Phoenix ensuring exposure to dynamic economic environments. This geographic spread mitigates the impact of localized economic downturns, providing a buffer against regional market volatility. Sector-wise, the inclusion of retail, hospitality, mixed use, and industrial properties ensures a balanced portfolio that can adapt to shifting market conditions and demand patterns. The deal also features robust credit enhancement through subordinate classes, which provide an additional layer of protection for senior tranche investors.

Access Loan Details

For subscribers to CRED iQ

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals. With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

If you would like to learn more about CRED iQ’s products and services, please contact team@cred-iq.com or (215) 220-6776.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING SOLD IN AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES IN ANY REGARD WHATSOEVER, AND ACKNOWLEDGE THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

Troubled Loan Workout Strategies: A Mid-Year Report

By

Michael Haas

-

August 2, 2024

0

Modifications and Foreclosures Spike; While Resolutions and REO Percentages Drop

This week, our CRED iQ research team explored trends in workouts and resolutions for CRE securitized loans so far in 2024. We wanted to understand how the continued elevated interest rate environment is impacting how distressed loans are ultimately resolved. Our team compared the special servicer’s workout strategies from June 2024 with December 2023 and analyzed how the first six months 2024 has evolved.

Our analysis compared workout strategies across $71 billion in loan balances (6,018 loans) in December of 2023 with $81 billion (6,359 loans) in June of 2024. The top 4 workout strategies used by special servicers from this dataset includes: 1) Successful Resolution 2) Foreclosure or Deed-in-Lieu of Foreclosure 3) Modification or Loan Extension and 4) Return to the Master Servicer.

CRED iQ notes that 45.9% of specially serviced loans were labeled as “Resolved” in December ’23 compared to only 40.5% of loans in June 2024. Similarly, loans with the special servicer headed for a full payoff dropped from 1.1% in December to 0.7% in June 2024.

The second-most common strategy, “Foreclosure” saw a notable increase when comparing December ’23 to June ’24 rising from 9.2% of all loans to 12.2%, a 33% increase in six months. REO strategies saw a drop in the period from 7.2% to 6.4%. Note sale workouts declined from 0.8% to 0.4% in June 2024.

Maturity Extensions and loan modifications, or the so called “extend and pretend” category continued to grow in strength as this strategy has spiked from 6.8% in December ’23 to 11.2% in June 2024, a 65% increase.

Notable Workout Example

The Point at Caldwell Station, a 297-unit multifamily property, is backed by a $56.3 million senior CRE CLO loan and $15.0 million of mezzanine debt. The loan was scheduled to mature in March 2024 with a final extended maturity date of September 2027, if all three extension options are exercised. The loan failed to pay off at its initial maturity date and the special servicer is pursuing foreclosure.

Built in 2023 and located in the North Charlotte submarket of Charlotte, the asset was appraised for $101.5 million (as-is) with a stabilized value of $115.0 million. Stabilization was anticipated for October 2024 with an DSCR (NCF) of 0.89 and occupancy of 93.0%. The collateral was not leased at underwriting and remained vacant as of March 2024.

Sign Up for CRED iQ Today

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

Announcing BMO 2024-5C5

By

Michael Haas

-

July 29, 2024

0

A CRED iQ Preliminary Analysis

BMO 2024-5C5 is a significant new issue CMBS deal with an approximate mortgage pool totaling around $1.02 billion. This transaction is managed by BMO Capital Markets, Citigroup, Deutsche Bank, SG Americas, Goldman

DATA HEREIN PROVIDED TO CRED IQ IS FROM A PRELIMINARY PROSPECTUS AND MAY BE AMENDED OR SUPPLEMENTED PRIOR TO TIME OF SALE

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Deal Overview

BMO 2024-5C5 is a significant new issue CMBS deal with an approximate mortgage pool totaling around $1.02 billion. This transaction is managed by BMO Capital Markets, Citigroup, Deutsche Bank, SG Americas, Goldman Sachs, and UBS Securities with additional support from co-managers Academy Securities, Bancroft Capital, and Drexel Hamilton. The offering consists of 36 loans secured by 65 properties, presenting a diversified portfolio that spans various property types such as multifamily, office, and hotels. The properties are geographically dispersed, ensuring a robust risk mitigation strategy for investors.

Key Metrics

The loan pool is structured to include a mix of amortizing and interest-only loans, with 6.8% of the mortgage pool having scheduled amortization and the remaining 93.1% providing for interest-only payments throughout the loan term. Additionally, the pool features a weighted average debt service coverage ratio (DSCR) of 1.53x and a weighted average net operating income (NOI) debt yield of 11.4%, indicating strong underwriting standards and financial performance.

Geography & Top Assets

The transaction highlights include properties concentrated in major markets like New York City, Atlanta, and San Francisco. Significant assets include the Arthouse Hotel in the Union square submarket of New York City and The Motif by Morningside multifamily property in the Atlanta market. The deal is set to close on August 15, 2024, with the master servicer being Midland and the special servicer being LNR Partners. This CMBS offering presents a well-structured investment opportunity with diverse property types and geographic distribution, designed to deliver stable returns and mitigate risks effectively.

Access Loan Details

For subscribers to CRED iQ

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals. With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

If you would like to learn more about CRED iQ’s products and services, please contact team@cred-iq.com or (215) 220-6776.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING SOLD IN AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES IN ANY REGARD WHATSOEVER, AND ACKNOWLEDGE THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

Announcing BANK5 2024-5YR8

By

Michael Haas

-

July 26, 2024

0

A CRED iQ Preliminary Analysis

DATA HEREIN PROVIDED TO CRED IQ IS FROM A PRELIMINARY PROSPECTUS AND MAY BE AMENDED OR SUPPLEMENTED PRIOR TO TIME OF SALE

Access Loan Details

Deal Overview

BANK5 2024-5YR8 is a new issue CMBS deal with a total pooled balance of approximately $690.5 million. Jointly managed by Banc of America, Morgan Stanley, Wells Fargo Securities and JP Morgan, this deal includes 32 loans secured by 33 properties across various sectors like retail, mixed-use, office and hospitality. The deal features a weighted average loan-to-value (LTV) maturity ratio of 55.8% and a weighted average mortgage interest rate of 6.80%. The offering is scheduled for closing on August 15, 2024, providing diverse and stable investment opportunities for CRE finance professionals.

Key Metrics

The loan pool is structured to include a mix of amortizing and interest-only loans, with 16.9% of the mortgage pool having scheduled amortization and the remaining 83.1% providing for interest-only payments throughout the loan term. Additionally, the pool features a weighted average debt service coverage ratio (DSCR) of 1.63x and a weighted average net operating income (NOI) debt yield of 12.4%, indicating strong underwriting standards and financial performance.

Geography & Top Assets

The transaction highlights include properties concentrated in major markets like New York City, Atlanta, and Las Vegas with significant assets such as the Showcase I, an anchored retail property in Las Vegas and the 640 5th Avenue mixed-use (office/retail) property in New York. The top 10 loans represent 69.8% of the pool balance with retail and mixed use properties backing more than half of the initial pool balance.

Access Loan Details

For subscribers to CRED iQ

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals. With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

If you would like to learn more about CRED iQ’s products and services, please contact team@cred-iq.com or (215) 220-6776.

THE DATA, INFORMATION AND/OR RELATED MATERAL (“DELIVERABLES”) IS BEING SOLD IN AS-IS/WHERE-AS CONDITION. CRED-IQ MAKES NO REPRESENTATION OR WARRANTY AS TO QUALITY OR ACCURACY OF SUCH DELIVERABLES BEING PURCHASED, WHETHER EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION OF LAW, STATUTE, OR OTHERWISE, AND CRED-IQ SPECIFICALLY DISCLAIMS ANY AND ALL IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE, TECHNICAL PERFORMANCE, AND NON-INFRINGEMENT. WITHOUT LIMITING THE FOREGOING, YOU AS CUSTOMER ACKNOWLEDGE THAT YOU HAVE NOT AND ARE NOT RELYING UPON ANY IMPLIED WARRANTY OF MERCHANTABILITY OR OF FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE, OR UPON ANY REPRESENTATION OR WARRANTY WHATSOEVER AS TO THE DELIVERABLES IN ANY REGARD WHATSOEVER, AND ACKNOWLEDGE THAT CRED-IQ MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION, WARRANTY OR GUARANTEE THAT THE PURCHASE, USE OR COMMERCIALIZATION OF ANY DELIVERABLES WILL BE USEFUL TO YOU OR FREE FROM INTERFERENCE. BY ACCEPTANCE OF THE DELIVERABLES, YOU HEREBY RELEASE CRED-IQ AND ITS AFFILIATES AND AGENTS FROM ALL CLAIMS, DAMAGES AND LIABILITY ARISING HEREUNDER.

CMBS New Issue Underwriting Trends – July 2024

By

Michael Haas

-

July 26, 2024

0

The CRED iQ research team focused upon the underwriting of the latest market transactions. We wanted to understand they key loan metrics across this universe to get a real-time sense of the new issues marketplace.

CRED iQ analyzed underwriting metrics for the latest 3 CMBS conduit transactions. We reviewed 158 properties associated with 101 new loans totaling $2.4 billion in loan originations. All of the loans originated within the past 4 months. Our analysis examined interest rates, loan-to-values (“LTV”), DSCR (NCF), debt yields, and cap rates. We further broke down these statistics to show a minimum, maximum and average for each metric and by property type.

The average interest rate across all loans and property types was 6.9%, average LTV was 59.2%, implied cap rates averaged 6.4% with debt yields averaging 11.7%.

Office

In total, 16 properties (of the 158 total in our analysis) were secured by office assets, comprising a total loan balance of $500 million. Average interest rates were 7.3%, average implied cap rates averaged 7.02% Debt yields and LTVs averaged 12.1% and 59.2, respectively.

Multifamily

There were 51 properties secured by multifamily properties totaling $980 million in new loan originations. Interest rates averaged of 6.70%. Cap rates averaged 6.00% for the multifamily sector. Average debt yields were 10.4% and LTVs averaged 62.5%, which was the highest for each of the sectors.

Retail

The retail component had a total of $345 million. In total, 18 properties were secured by retail properties. Interest rates average 6.87%. Cap rates averaged 6.16% for the retail sector. The average debt yield was 12.3%. Average LTVs were 57.3%.

Other Notable Findings

Hotels had the highest average interest rate (7.57%), cap rate (7.24%), and debt yield (12.7%) across the sectors.

Self Storage (3 properties, $27 million) and Manufactured housing (12 properties, $70 million) represented the smallest property types.

Sign Up for CRED iQ Today

About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.

Distress Rate Climbs to 10.3% for CRE CLOs; 62% of Properties are Operating Below Breakeven

By

Michael Haas

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July 18, 2024

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The CRED iQ research team continued its examination of the CRE CLO ecosystem as the CRE CLO distress rate reached 10.3%, an increase of 60 basis points since our June report. This includes any loan reported 30 days delinquent, past their maturity, specially serviced, or a combination of these. We also examined the most recent property-level net operating income figures and compared them to underwritten expectations.

Given the rapid surge in interest rates, these floating-rate loans have shown significant declines in debt-service-coverage-ratios (DSCR). Approximately 78.4% of the properties within the CRE CLO sector have reported a lower DSCR (NOI) compared to their underwritten DSCR. These numbers are based on the underwritten “as is” DSCRs and NOI. CRED iQ’s analysis uncovers that 62.0% of all CRE CLOs are operating below a 1.00 DSCR.

Removing the interest rate variable, CRED iQ data uncovered that 46.4% of all CRE CLO loans perform below their underwritten net operating income levels. Approximately 53.6% of the properties reported NOI figures above the underwritten NOI. Net operating income is a key variable in calculating a loan’s DSCR which determines the strength and creditworthiness of a given loan.

CRED iQ consolidated all of the loan-level performance data for every outstanding CRE CLO loan to measure the underlying risks associated with these transitional assets. Many of these loans were originated in 2021 at times where cap rates were low, valuations high, low interest rates, and are starting to run into maturity issues given the spike in rates.

Our research team analyzed $79.1 billion in active CRE CLO loans (an increase of ~$1 billion from the June report) to better understand current distress levels and exposing any potential forecasting bellwether metrics. Along those lines we further explored 1) Loans that have been added to the servicer watchlist 2) The triggers that caused the watchlist designation.

Some of the largest issuers of CRE CLO debt over the past five years include MF1, Arbor, LoanCore, Benefit Street Partners, Bridge Investment Group, FS Rialto, and TPG.The vast majority of the $79.1 billion in CRE CLO loans are structured with floating rates with 3-year loan terms equipped with loan extension options if certain financial hurdles are met.

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About CRED iQ

CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.

With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.