George PearkesApr 16, 2014
This is great MT @SMulholland_: Citigroup is lending its Tribeca landlord $1.5 Billion and selling of the mortgage to make more #CMBS
Matt MaisonMar 5, 2024

Chart of the Moment: Commercial Real Estate’s Surprising Rally
Brandywine Global - February 22, 2024

“Despite all the ‘doom and gloom’ news, commercial mortgage-backed securities (CMBS) rated BBB have outperformed Treasuries, corporate bonds, and other securitized credit sectors for the year to date through mid-February.”

https://brandywineglobal.com/aroundthecurve/index.cfm?page=article&content=800779115

#CRE #CMBS #Multifamily
@realestate

Chart of the Moment: Commercial Real Estate’s Surprising Rally

Commercial real estate has been caught in the center of the perfect storm. Given its high sensitivity to interest rates, the sector came under pressure from the rapid and precipitous rise in rates. Additionally, lifestyle changes and pandemic-related shifts to hybrid and remote work led to a glut of office supply. The commercial real estate market’s impending demise has been well documented, with headline risk a frequent concern. Yet despite all the “doom and gloom” news, commercial mortgage-backed securities (CMBS) rated BBB have outperformed Treasuries, corporate bonds, and other securitized credit sectors for the year to date through mid-February. Some of this rally in CMBS likely was triggered by market expectations that interest rates peaked with the Federal Reserve's recent pivot. Commercial real estate is one of the most leveraged sectors—making it also one of the most interest rate sensitive sectors—perhaps in the entire credit market. The pessimistic market sentiment already priced into the market and the cheap valuations provide a catalyst for a rally when the forecasted draconian scenarios do not materialize. Other factors potentially contributing to the recent rally include the tightening of bank lending standards and the lack of new issue supply. As we discussed in our recent podcast, it is important to remember there are diversified property types within the CMBS market, including multifamily, retail, hotels, industrial, and self-storage; it is not all about offices. Each property type has its own idiosyncratic characteristics, although these may frequently be overshadowed by the extreme negative market sentiment around offices. We are not saying the market fundamentals for CMBS have bottomed yet, but we still see opportunities within the broad sector as it will take years to work out the excess supply in the office sector. At the same time, the office sector’s woes are not a market surprise anymore, nor do we expect a sudden market squeeze that would generate systemic risk. So, if the outcome for these loans turns out to be better than expected, the CMBS market could rally meaningfully. Index Definitions ICE BofA BBB U.S. Fixed Rate CMBS Index tracks the performance of U.S. dollar-denominated BBB-rated fixed rate commercial mortgage-backed securities publicly issued in the U.S. domestic market. ICE BofA 7-10 Year BBB U.S. Fixed Rate CMBS Index is a subset of the ICE BofA BBB U.S. Fixed Rate CMBS Index, tracking the performance of U.S. dollar-denominated BBB-rated fixed rate commercial mortgage-backed securities with maturities of 7 to 10 years publicly issued in the U.S. domestic market. ICE BofA AA-BBB Fixed-Rate U.S. Asset-Backed Securities Index is the AA-rated to BBB-rated subset of the ICE BofA U.S. Fixed-Rate Asset-Backed Securities Index, which tracks the performance of USD-denominated investment-grade fixed-rate asset-backed securities publicly issued in the U.S. domestic market. ICE BAML U.S. Corporate Index tracks the performance of U.S. dollar-denominated investment grade corporate debt publicly issued in the U.S. domestic market. Qualifying securities must have an investment grade rating (based on an average of Moody’s, S&P, and Fitch), at least 18 months to final maturity at the time of issuance, at least one year remaining term to final maturity as of the rebalancing date, a fixed coupon schedule, and a minimum amount outstanding of $250 million. ICE BofA U.S. Mortgage-Backed Securities Index tracks the performance of U.S. dollar-denominated, fixed-rate and hybrid residential mortgage pass-through securities publicly issued by U.S. Agencies in the domestic market. Included in the index are 30-year, 20-year, 15-year and interest-only, fixed-rate mortgage pools, provided they have at least one year remaining to final maturity and a minimum amount outstanding of at least $5 billion per generic coupon and $250 million per production year within each generic coupon. ICE BofA Current 10-Year U.S. Treasury Index tracks the performance of U.S. dollar-denominated 10-year sovereign debt publicly issued by the U.S. government in its domestic market. It is a subset of the ICE BofA U.S. Treasury Index. Morningstar LSTA U.S. Leveraged Loan Total Return Index is a market value-weighted index designed to measure the performance of the US leveraged loan market based upon market weightings, spreads, and interest payments. J.P. Morgan Collateralized Loan Obligation (CLO) BB Total Return Index is a total return subindex of BB-rated securities within the J.P. Morgan Collateralized Loan Obligation Index (CLOIE), which is a market value-weighted index consisting of U.S. dollar-denominated CLOs. ICE BofA U.S. High Yield Index tracks the performance of USD-denominated below investment grade corporate debt publicly issued in the major domestic markets.

Around the Curve
Aaron LongchampsDec 14, 2023

I'm so glad my Honda Insight has driver assist systems in it that are radar & camera equipped. Saved me from an accident today where I was on a local route, going the speed limit, and a car was stopped waiting for a left hand turn. I didn't see them, but my car did!

My adaptive cruise control was on as usual, the radar/camera picked them up, and immediately started flashing BRAKE at me. I have to give credit to Honda for how quickly it predicted there would be an issue if I didn't react.

The system detected the car was stopped ~120 yards in front of me, I was not slowing, and that I needed to brake immediately. Reaction times matter at 55 mph, and doubly so on winding two lane roads with no shoulder.

It's not the first time the driver assist system has saved me from an accident, and probably not the last. Nothing like hitting the brakes at 55 mph to get down to 0.

This is also what I want driver assist systems in car to do. Level 1, level 2, whatever. Help prevent accidents by reacting faster than humans.

#honda #insight #driverassist #cars #acc #cmbs

Ed KellyJul 1, 2023

Mortgage-Backed Securities: What's the Current Investment Environment?

https://twotreessally.substack.com/p/the-changing-landscape-of-mortgage

The first in a series of journal posts exploring the current MBS landscape.

#MBS #CRE #CMBS #Investing #Investments #MBB #VMBS #SPMB #MORT #REM #REITS #realestateinvestment

The Changing Landscape of Mortgage-Backed Securities

What Should Investors be Looking at in MBS: Spreads, Allocation, Supply and Demand?

Two Trees Investment Journal
Show threadjergyMay 2, 2023

DD from Peruvian Bull

"The Fed has created a singularity from which there is no escape."

https://www.reddit.com/r/Superstonk/comments/13529zw/strange_things_volume_iii_the_dying_banks_and_the/

#superstonk #USD #Fed #FederalReserve #inflation #hyperinflation #bankingcrisis #CMBS

Strange Things Volume III: The Dying Banks and the Singularity

Posted in r/Superstonk by u/peruvian_bull • 8,072 points and 528 comments

reddit
⚯ Michel de Cryptadamus ⚯Apr 7, 2023

🚨 It's not every day you see an economic metric of at least middling importance down almost 80% in a singe year... but commercial mortgage backed securities have done it.

Not to be outdone, collateralized loan obligations are down 93% year over year.

Buckle up folks because the Commercial Real Estatemageddon is gonna be a wild ride.

https://therealdeal.com/national/2023/04/07/cmbs-market-plunges-to-11-year-low/
#CRE #CommercialRealEstate #CMBS #CLO #debt #realestate #FediFriday #FediFridays

Frozen CMBS Market Posts Slowest Quarter Since 2012

CMBS issuance plunged below $6 billion in the first quarter, down 79 percent from last year for the lowest quarterly volume since 2012.

The Real Deal