Analysis of distressed Commercial Mortgage backed Securities (CMBS) loans and special servicing : a case study

The outbreak of the COVID-19 pandemic in late 2019 has largely impacted the global economy by changing every aspect of our living environment with limited social and economic activities throughout 2020. This unprecedented economic downfall exposed real estate properties to high risk of default, pushing the CMBS loans delinquency rate to 10.32% in June 2020. As such an economic halt is likely to prevail, it is expected that the Commercial Real Estate (CRE) market would experience more distress in terms of debt service. Thus, it is imperative to overview the CMBS securitization process, the servicing structure, and the workout scenarios in case of loan default in order to understand the complexity of the CMBS structure and better prepare appropriate measures or strategies in response to current market landscape. By having a case study on 666 Fifth Avenue in New York, this paper will analyze one of the most high-profile properties that was transferred to special servicing to review strategies to resolve financial distress.

Name thesis:degree_name

Master

Department dc:contributor.department

Massachusetts Institute of Technology. Center for Real Estate

Grantor dc:publisher

Massachusetts Institute of Technology

Year dc:date.issued

2020

Author dc:creator

• Chang, Joon Keun.

Advisor dc:contributor.advisor

• Walter N. Torous.

• Center for Real Estate. Program in Real Estate Development.

Statement dc:rights

• MIT theses may be protected by copyright. Please reuse MIT thesis content according to the MIT Libraries Permissions Policy, which is available through the URL provided.

Licence dc:rights.uri

• http://dspace.mit.edu/handle/1721.1/7582

Language dc:language.iso

eng

Handle dc:identifier.uri

https://hdl.handle.net/1721.1/129103

OAI identifier oai:identifier

oai:dspace.mit.edu:1721.1/129103