Tough Times for Lenders : Financial Services Lawyer & Attorney : Winstead Law Firm : Finance, Banking, Bankruptcy

In an earlier posting on CRE finance reform and market trends, I stepped back and asked the all-important questions:

• What does all this mean?
• What is the big-picture?
• Where is this going?

I offered up four perspectives, with these as the first two –

1. The Good: the “return” of the unregulated lender

2. The Bad: "extend and pretend” will continue due to more and more CRE defaults.

My third perspective is much more controversial, and probably will not receive explicit recognition nor acknowledgment by many:

3. The Uncertain CMBS 2.0: Practical and important structural challenges abound before the new CMBS (“CMBS 2.0”) will include pools of loans from multiple borrowers, in amounts that will have a meaningful impact on the CRE finance market. Challenges from the investment grade bondholder include: (i) loan level transparency, (ii) structural concerns for CMBS 2.0, and (iii) finding an effective forum to effectuate these changes.

These are just some of the challenges facing CMBS 2.0, framed from the perspective of one of two of the most important players in the CMBS structure - an imaginary or hypothetical investment grade bondholder.

From this Investment Grade Bondholder: without this player, there is no market for CMBS bonds. This player is the most “under represented” player in the CMBS industry.  Here are some questions crafted with the voice of this hypothetical investor, as the industry heralds the arrival of CMBS 2.0:

• LOAN LEVEL TRANSPARENCY: Will CMBS 2.0 offer “real” loan or property level transparency, such as disclosure of modification terms for loans in special servicing; or rent rolls and operating statements for performing loans?
  • Servicers tell us that the Investor Reporting Package (IRP) [download guide; download version 5] contains information sufficient to our needs; will you tell this to our accountants and make them go away; and to the SEC as it seeks more transparency from us in our reporting? (This is all about information . . . data that we need.)
  • Speaking of the SEC, have you seen the proposed SEC rule [download a summary] that will require the disclosure of specific loan-level data, at securitization and then during the life of the pool?  Does the scope of the proposed rule address our needs? We're going to look into this . . . . (In a future posting, I'll cover the struggle between the servicers and the investment grade bondholders over loan level disclosures, which now comes under public scrutiny with the SEC's proposed rule.  The proposed SEC rule is called a "tectonic event" and a "tsunami" by a group working on industry-wide data standards.)
  • Who were the investment grade bondholders on the IRP committee that created this report?
  • Does the IRP “match up” with the pooling and servicing agreement provisions covered by my bond? (Did the attorney that drafted the PSA conform it to the IRP? We’re gong to look into this . . . .)
  • We understand that CMBS loan servicers report that loan level transparency (such as giving us current rent rolls) has legal hurdles relating to privacy rights of the CMBS borrower; so, where is the legal “white” paper that shows commercial parties have implied rights of privacy; or is it really a financial concern on the part of the loan servicers? Do the mortgage documents really prohibit disclosure?
• SIMPLE CMBS 2.0 STRUCTURE (?):
  • As to pools with multi-borrower loans, will these pools be the simple structures seen by us in the CMBS pools that were closed in the 4^th quarter of 2009? (Simple gives us both transparency and structures that address our special servicing concerns.  "Simple" does NOT look like this: download (depiction of a fairly typical debt structure from the "old" CMBS model).
  • Will we have information from, and the ability to influence, the special servicer in its decisions? What will assure us that the special servicer truly is making independent decisions in multi-borrower pools?
  • Who will be paying the rating agency fees; and how will the rating agency be equipped to monitor the pool going after securitization; and what will the rating agency reform look like? (Take a look at our white paper for our bottom line on rating agency reform.)
• FORUM FOR CHANGE(?): if we become active in the Investment-Grade Bondholders Forum with the CRE Finance Council, will this really be the best forum for us to champion loan level transparency, and where our comments relating to CMBS 2.0 structure will be given due consideration?  If not at this Forum, then where?

These are tough questions.

• What questions am I missing from this imaginary or hypothetical investment grade bondholder?

As we envision CMBS 2.0, this is at least one elephant in the room.

If you have comments or observations, or your own questions, please post a comment     

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Yesterday, the Commercial Mortgage Securities Association (CMSA) submitted a comment letter [download] to the FDIC concerning the FDIC's 'Safe Harbor' rule [down load the FDIC's Advanced Notice of Proposed Rulemaking] covering the securitization of commercial real estate loans. 

Of course, the CMSA is not the only industry organization to comment on the FDIC's proposed rule.  For example, Housing Wire [link] describes comments to the proposed rule raised by the American Securitization Forum, the Mortgage Bankers Association and the Securities Industry and Financial Markets Association.

The FDIC's proposed rule is designed to isolate, from the failure of a bank, the underlying assets of securities held by the bank.  The treatment by the FDIC of assets transferred by a bank in connection with a securitization, and the subsequent failure of the bank, is an underlying building block for securitization - simply because investors will NOT buy CMBS bonds if the underlying loans may be stripped from the CMBS pool, if the bank that originated the loan goes into FDIC conservatorship or receivership.

Under the proposed new rule, the safe harbor would be amended to include numerous preconditions regarding a transaction’s capital structure, disclosure, documentation, origination and compensation.

I really don't have anything to "add" to the pointed comments made by these organizations .  If you want the "detail" on their perspectives, I've furnished you the links (above).  (They contain some very, very interesting points.)

My focus is on the following statement in the CMSA' e-mail announcing its comment letter:

"[The] CMSA suggests that the FDIC work in concert with Congress, the Obama Administration and the other agencies that are developing securitization reforms to ensure that FDIC's safe-harbor efforts do not lead to a regulatory framework of conflicting or overlapping requirements that may impede the restoration of functioning credit markets."

My read of the situation remains unchanged:

• unlike at the creation of the CMBS model in the early '90s, the financial crisis and the role of CMBS 2.0 in it is a political process - which means a large number of parties have a voice in the process
• the changes needed to restart the CMBS model (referred to as "CMBS 2.0") are not easy
• mid-term elections mean that Congress will NOT address this critical component of the credit crisis once the heavy campaigning begins (in August) . . .
• . . . which leads to the conclusion that in 2010, we will NOT see a return to a meaningful CMBS market.  In other words, no CMBS 2.0 for the small commercial real estate borrower.  Sure, single sponsor deals with the best DSC, LTV and other uber-credit criteria will be launched (good for Wall Street).  But a multiple borrower pool of small loans (help for Main Street)?  I say not in 2010.

I hope that I'm wrong.

If you view it differently, please comment below.

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The CMSA has published the text of the testimony by Christopher Hoeffel, from his appearance yesterday before the US House Financial Services Committee.  As noted in my posting earlier this week (link), the Committee is investigating the use of the "covered bond" product as one tool to revive the CRE capital markets (and solve some of the problems with the CMBS model).

Here is a link to the testimony: LINK

The testimony is very instructive, and a must read.

I suggest that you research the covered bond.  We've been collecting materials for the last year.

If you have any questions, comments or help full materials on covered bonds, please post a comment.

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More on my series commenting on the CMBS loan market and the broader capital markets for commercial real estate . . . .

Previously, we've brought to your attention a type of commercial real estate debt structure that HAS worked in the EU (for hundreds of years), and it HAS been tried at least twice in the U.S.  [link to prior posting]

It is called a "covered bond." 

Click here:  Wikipedia has a good description of it .

Covered bonds offer the best hope for improving the current capital grid lock, which has the commercial real estate market on its knees.  Covered bonds will be an important piece of the credit stack for the U.S. commercial mortgage market.  It will help the commercial real estate market recover.

We've meet with a EU bank that handles this product (during our trip to the EU in 2008) and we've closely followed this important topic since the then.  So, stay tuned.  We'll write more on it.

All that you need to know right now is that covered bonds are similar to CMBS pools, with this important difference: the issuer (read: the original lender) retains some risk on the performance of the pool.  This means that the issuer services the individual loans and literally cares for the loans—yes, this is the "retained risk" phrase that you'll start to read about.  For example, when a loan in a mortgage bond pool goes "bad," the issuer can swap out the "bad" loan with a "good" loan.  (What an idea!)  Sure, there are hurdles to this concept in the U.S., including probably amending the U.S. Bankruptcy Code.  And the public probably is in no mood to do that right now.  But as the real estate "recession" extends into 2010 and beyond, the time will come . . . .

 . . . maybe sooner than later.

A recent announcement from the CMSA (Commercial Mortgage Securities Association Web site) got me going today on this topic - tomorrow the U.S. House Financial Services Committee will hold a hearing entitled "Covered Bonds: Prospects for a U.S. Market Going Forward."  Here is the CMSA announcement:

"CMSA Executive Committee Member and immediate past president Christopher Hoeffel will testify before the full House Financial Services Committee on Tuesday, December 15 at 10:00 a.m. ET. The hearing, “Covered Bonds: Prospects for a U.S. Market Going Forward,” will provide a forum to discuss how such a market could be structured in light of current changes and the recovery efforts occurring within the financial markets.  For its part, CMSA supports efforts by policymakers to facilitate a U.S. commercial covered bond market in order to provide an additional source of liquidity through new and diverse funding sources, and the association continues to advocate for the inclusion of commercial mortgages in a covered bond market.  Mr. Hoeffel’s remarks and the hearing itself can be watched live through the House Financial Services Committee’s video sever shortly before the 10:00 a.m. ET start-time December 15."

IF Congress and IF the American public can stomach including covered bonds as part of the financial reforms, then the commercial real estate market will finally have some capital relief.

There is hope.

If you have thoughts, comments, questions or resources covering covered bonds, please post a comment.

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By now you should be well aware of this "bad" fact stemming from failure or lock-down of the CMBS loan market:

• Between now and the end of 2012, more than $600 billion CRE loans will mature in EXCESS of the average 3-year historical gross originations from all non-commercial CRE lenders.  In other words, in the absence of a CMBS loan origination market, +$600 billion of CRE loans will mature with no historical source for pay-off (See PDF).

In other words, if the loan is within the tight bandwidth of the best underwriting standards (for example, high debt-service coverage and low loan-to-value), then the loan probably will find a refinancing source.  If it is not, then there simply isn't credit available to repay the loan.  Thus, the lender\servicer has two choices: extend the loan or foreclose.

This gives you a good perspective of the "why" behind the "extend and pretend" approach adopted by banks and CMBS servicers.

So, for all those loans that are not in the tight bandwidth, where are we on the all-important topic of jump starting or replacing the CMBS market?  (Show us the money)

Here's a quick scorecard that indentifies a few recent milestones:

• New CMBS Issuances!!  Yes, two new issuance of CMBS hit the market last week.  It has been nearly two years since the last sale of new CMBS issuance.  While it is an important first step, the DDR Depositor LLC Trust 2009 Commercial Mortgage Pass Through Certificates (series 2009 DDR1) signals little hope for the typical CRE investor: this CMBS pool is a single sponsor structure, with low loan-to-value (@ 62%), great debt-service coverage (@ 1.4x), and a significant percentage of investment-grade tenants (@23% of total square footage and @15% of base rent).  And the same can be said of the second issuance, which was the Bank of America Large Loan Trust 2009-FDG.  The BoA deal was a single, seven-year, fixed-rate non-recourse loan to entities of Fortress Funds.  Neither issuances, however, involved a pool of small loans from a wide variety of borrowers.  While something is better than nothing, these two issuances do not signal immediate help to the typical owner (Link to CMSA summary).  Bottom line: great news for Wall Street; no help for Main Street.

• Basic Changes to the CMBS Model - Risk Retention. The Hill seems to be listening to the CRE industry.  In September, the CMSA issued a white paper (PDF) giving input on the 2009 Financial Regulatory Reform proposals currently being studied by Congress—but from the perspective of the commercial mortgage market.  Last week, the House Financial Services Committee passed an amendment to the reform bill that (i) places the risk retention requirement at 5% and (ii) recognizes third-party investors (who purchase the first-loss position and re-underwrite all loans during pooling) as proper holders of the risk retention piece.  This is a important victory for the CRE industry.

• Rating Agencies in the Spotlight. Part of the reform includes changes in the role and function of the rating agencies.  My perspective is that we really haven't heard much from the most important player in the mix: the investor. (The party who literally "buys" the CRE investment, whether in the form of a CMBS bond or a limited partnership interest.) For a hint of the investor's perspective, read this white paper (PDF) from the Council of Institutional Investors (website).  It strongly argues for more accountability on the part of the rating agencies.  At the very least, this points to the fact that the "re-examination" of the CMBS recipe is wide ranging.  And with topics such as rating agency liability on the table, I doubt that there will be a quick fix.  And, as noted above, the "table" is located on the Hill,  which is not a friendly banquet hall for commercial real estate . . . .

• More Extend and Pretend. What does a "no quick fix" mean?  Navigating the CMBS ship through the political process will NOT be a quick trip.  Consequently, for loans that are nearing maturity, or are in distress, the rescue plan will involve the current lender for the next 12 months.  At the loan level, it will take creativity and a thorough understanding of the market and the lender\servicer constraints (such as the new guidelines for banks or the PSA limitations for CMBS servicers), in order to keep the loan out of foreclosure.

 Please post your thoughts or comments on other key markers that you've seen.

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Article Co-Author:  Courtney D. Bristow, Winstead PC

It’s Monday morning and you’re getting ready for work with the news on the TV in the background. By now, you’re practically immune to the daily dose of doom and gloom that has become business news, particularly with regard to real estate and mortgage-backed securities. So you’re not overly concerned when you hear the anchor say, “Vital signs are dangerously low in the commercial mortgage-backed securities market. We’re suffering from a trifecta of decimated bond prices, weakening mortgage performance and drastically reduced loan originations. The threefold combination has pummeled portfolio values and deprived borrowers of a primary source of commercial real estate financing.”1 As you turn off the television and head out the door, you find solace in the fact that you work for a public healthcare company and not a financial services firm.

Your phone is ringing as you walk into your office. It’s your CFO explaining that a $5 million loan on one of your office buildings in Michigan is maturing in three months. He asks you to help the company’s internal business unit that is desperately searching for new financing while, at the same time, communicating with the commercial mortgage-backed securities (CMBS) loan servicer who manages the loan. Did he just say CMBS? Loan servicer?  Find financing upon maturity?  What do you need to know about the CMBS industry and its participants to navigate through this mortgage mess that just fell into your lap? Click here to read the entire article.

Article published in the September issue of American Corporate Counsel (ACC) Docket, the award-winning journal of the Association of Corporate Counsel.
 

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At the September announcement of the REMIC announcements from the US Treasury the IRS, we posted copies of the materials relating to "significant modifications" to CMBS loans.

Last week, Lou Strawn weighed in on his perspective on the significance of these changes.

Today, the Commercial Mortgage Securities Ass'n gives us the industry's "official" perspective in a white paper.

The prediction here is that these REMIC reforms will NOT have a significant impact on the log-jam of distressed loans needing modifcation (in conjunction with a workout).

If you see it differently, or have an experience that you want to explore, please post a comment.

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For the next couple of days, I'll be attending the annual meeting of the American College of Mortgage Attorneys (ACMA).  Members of ACMA are a select group of in-house and outside counsel, who are recognized as leaders in commercial real estate finance.

OK, I know:  You're rolling your eyes as your internal big screen pans a view of a room full of (ego laden?) lawyers, sitting in your basic seminar setup, listening to speakers (most by now are far enough up the tech curve to use PowerPoint), and discussing . . . .

Here's where you should wake up to the relevance of it all:  What are the topics that the legal thought-leaders are focusing on?  What has their attention?

I'll admit that some (most?) events like this are grueling for me, but simply because I can't sit still for a stretch of 8 hours.  The content, however, keeps my attention.  And because I think that it might interest you, below is a summary of several of the topics.

A reminder for you:  If you want more information on distressed debt & investments, go to the "Client Resources" tab on our blog homepage.  It contains instructions on how you can access our extranet site, where we have posted 60+ papers, articles and presentations for you to read, download, etc.  It is free.  It is available 24/7.

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Guest Writer - Christopher T. Nixon, Winstead PC

In part 1, I covered the relationship between the loan servicer and the B-note holder, and the role of the B-note holder in making decisions about the loan.  This posting addresses a situation where that the B-note holder no longer can participate in decisions, and the replacement of the special servicer.

Is there any circumstance in which the B-note holder no longer has consultation and consent rights?
Yes, in the event of a Control Appraisal Event, the B-note holder typically loses its consultation and consent rights under the co-lender agreement.  A Control Appraisal Event is typically defined as a reduction in the principal balance of the B-note by appraisal deductions or realized losses to below a certain level (typically 25%; although we have seen percentage levels as high as 50%) of its original principal balance.  In this event, the consultation and consent rights are transferred to the A-note holder under a typical co-lender agreement.

Under the co-lender agreement, may the B-note holder replace the master servicer?
Absent a breach by the master servicer under the co-lender agreement, the B-note holder has no right to replace the master servicer.

Under the co-lender agreement, may the B-note holder replace the special servicer?
The B-note holder may replace the special servicer without cause at any time, subject to certain conditions being met with respect to the replacement special servicer.  However, it is important to note that the B-note holder is responsible for certain costs and expenses incurred in connection with such replacement, and such replacement may cause significant delays and disruption in the servicing of the A/B loan.  Under most co-lender agreements, the B-note holder loses the right to replace the special servicer upon the occurrence of a Control Appraisal Event.

Conclusion:
Because the terms and conditions of co-lender agreements are typically heavily negotiated between the A-note holder and the B-note holder, it is essential for a CMBS loan servicer to review and understand the terms and conditions of the co-lender agreement for the particular A/B loan being serviced.  A failure by the loan servicer to comply with the terms and conditions of the co-lender agreement for the particular A/B loan being serviced may expose the loan servicer to liability to the B-note holder in connection with the servicing of the A/B loan.

If you have any questions, commentary or stories to share, please post a comment
 

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Guest Writer - Christopher T. Nixon, Winstead PC

CMBS loan servicers have duties to a myriad of parties in the servicing of a CMBS loan, including the REMIC trust, the bondholders, and the borrower.  With respect to an A/B loan, a CMBS loan servicer also has certain duties to the B-note holder pursuant to the terms of the co-lender agreement between the A-note holder and the B-note holder.  Because co-lender agreements are typically heavily negotiated during the origination of an A/B loan, CMBS loan servicers should carefully review the co-lender agreement for the particular A/B loan being serviced to fully understand its duties thereunder to the B-note holder in connection with servicing the A/B loan.

What is the relationship between the CMBS servicer and the B-note holder?
A CMBS loan servicer's relationship with the B-note holder derives from the co-lender agreement between the A-note holder and the B-note holder. The co-lender agreement governs the relationship, and sets forth the duties, liabilities and rights of the A-note holder and the B-note holder with respect to the A/B loan.  A typical co-lender agreement provides that the A-note holder will service the A/B loan on behalf of both the A-note holder and the B-note holder.  When the A-note holder places the A/B loan into a CMBS loan pool pursuant to a typical pooling and servicing agreement, the CMBS loan servicer assumes the A-note holder's obligation to service the A/B loan.

What rights does the co-lender agreement provide to the B-note holder in connection with the servicing of the A/B loan?
The co-lender agreement provides to the B-note holder consultation and consent rights with respect to certain major servicing decisions related to the A/B loan.  The B-note holder's consultation right requires the loan servicer to obtain and consider the advice and suggestions of the B-note holder before taking certain actions related to the A/B loan.  The B-note holder's consent right requires the loan servicer to obtain the consent of the B-note holder before taking certain actions related to the A/B loan.

What major decisions require the servicer to consult with the B-note holder?
The provision of the co-lender agreement defining the B-note holder's consultation rights is typically heavily negotiated between the A-note holder and the B-note holder.  Thus, a loan servicer should pay particular attention to this provision of the co-lender agreement to fully understand the scope of the B-note holder’s consultation rights.  Some loan servicing decisions typically requiring B-note holder consultation are:

• Proposals to workout the A/B loan upon a borrower default
• Releases of A/B loan escrow funds
• Lease renewals requiring lender consent
• Mortgaged property alterations requiring lender consent

What major decisions require the servicer to obtain the consent of the B-note holder?
Like the provision defining the B-note holder’s consultation rights, the provision of the co-lender agreement defining the B-note holder's consent rights is typically heavily negotiated between the A-note holder and the B-note holder.  A loan servicer should carefully review this provision of the co-lender agreement given that there is no standard list of major decisions to which the B-note holder is entitled to consent.  Some loan servicing decisions typically requiring B-note holder consent are:

• Foreclosure of the mortgaged property
• Acceleration of the A/B loan upon a borrower default
• Releases of collateral from the A/B loan
• Assumptions of the A/B loan by a third party borrower
• Extensions of the scheduled amortization payments or final maturity date of the A/B loan

If you have any questions, commentary or stories to share, please post a comment.

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More on our "Watch For Change (at the state house)" series (prior postings on new business tax; new foreclosure fee) . . . .

I suspect that many state and local authorities soon will be requiring lenders to register a loan BEFORE the loan is foreclosed.

Yes, another foreclosure trip wire.

Recently, a representative of MERS (the electronic note registry used extensively with residential mortgage note and to a lesser extent with commercial mortgage notes securitized in CMBS pools) told me that MERS is being used in new ways - most notably, several cities (such as Chula Vista, CA) are using the registry to "track down" and identify owners, servicers and managers of foreclosed single family houses.

He also tells me that several states (VA & CA, for example) have pending legislation requiring all foreclosed property to be registered in a database for use by governmental authorities (data points for the registry include ownership, servicer, property manager, etc.).  (I'm tracking down information on this.)

• Why? Thousands of homes have been foreclosed, and sit vacant and unattended.  And the public wants them to be kept secure, yards mowed, pools serviced, etc.  No one wants a meth lab, or a party house, as your newest next door neighbor.
• Why not?  Public officials want votes, so they're looking for ways to "please" the public without spending public funds.

However, since most commercial mortgage notes are NOT registered with MERS, it will NOT be a data-ready tool for use in tracking down commercial lenders after foreclosure (one caveat: some CMBS notes have been registered in MERS).

. . . yet. I predict that this will catch on in state legislatures across the nation - making registration a requirement before foreclosure.

If you can give us some information on this, or if you have any questions or comments, please post a contact.

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In October 2008, Brenda Brown, Keith Mullen and Lou Strawn authored a series of posts while attending a real estate conference in Munich, and then from London as we returned to the United States.  The series chronicled the European perspective as the economic crisis first rattled around the world (Day 1, Day 2, Day 3, Day 4 & Last Day).   A "big picture" view of the crisis can be helpful in dealing with a troubled loan.

Before we attended the conference in Munich, we anticipated some of the topics that we thought would be of interest to Europeans, as the EU anticipated changes in U.S. politics, and as they watched alarming events in the U.S. economy (Pre-EU Trip ).

Early next week, we'll focus on the "big picture" in the U.S., as the three of us (and other Winstead lawyers) attend the Mortgage Bankers Association's Annual Commercial Real Estate Convention.  The focus of the convention is commercial real estate finance in the U.S. It is a huge "meet and greet" for lenders and mortgage brokers - where lenders explain their loan production in the prior year and present their projected production in the coming year, and ask mortgage bankers to help them achieve these goals.

Just as we did prior to our EU trip, we have listed what we think will be some of the "hot" topics at the MBA-CREF convention:

• Some anticipate that the turnout will be 40% below the attendance at last year's convention. What does this say about the anticipated volume of commercial real estate loans in 2009? Are people NOT attending the convention because they anticipate a significant decrease in loan production in 2009? Or is all or part of the drop-off simply because the investment banks, and the CMBS loan production shops (and product) have disappeared?
• As to CMBS, what about the looming "maturity defaults"covered by our earlier post? What will replace this large component of the financial market? What will happen when there are limited sources of commercial mortgage finance?  What does a severly constricted loan production line look like?
• Will the life companies increase their investment allocations to allow for an increase in mortgage loan production? What about the rumor that several life companies remain "out" of the market, and that other life companies have a defacto "no new loan" policy, based upon extremely cautious underwriting criteria? What will this look like in the market?
• Another rumor is that interested investors actively are contemplating starting new loan production platforms (partly in response to the void created by the death of the CMBS loan origination market). Is this for real?
• Some believe that we're about to enter the "age of regulation." How will this play out in 2009? For example, the risk-based capital rules severely limit the ability of insurance companies to restructure troubled loans. Will these rules be revised? Also, will Federal regulation of insurance companies be implemented; and how will that play out in mortgage investments?  Turning to banks, one rumor is that bank regulators effectively have put a freeze on new commercial mortgage lending. Will the regulators change their tune, so that banks, who hold a majority of commercial mortgages in the U.S., start to lend again?
• In 2009, will we (finally) experience a significant up-tick in defaulted commercial mortgage loans? Will they be bank loans, CMBS loans or life insurance company loans? And is the industry prepared?

These are incredibly troubled times in commercial real estate finance. This should be an incredibly interesting convention.  We will be reporting on what we hear and discover at the convention next week.

Please post your comments and questions.
 

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Keith Mullen and Lou Strawn head to Europe
Next week, we will be in Munich, Germany and then London, England visiting clients, and meeting with investors, lenders, title companies, investment bankers, mortgage bankers and fund advisors -- almost the entire spectrum of the "players" in the international real estate space.

We think that we know what some of the hot topics will be:

• What replaces the CMBS financed product? (covered bonds?)
• How "deep" is the stress in the U.S. commercial real estate markets?
• The U.S. economy in the next couple of years
• The much-discussed federal legislation and the "new" role of the U.S. government in the economy
• The demise of the U.S. investment banks (what's next?)
• "Where" are the opportunities for investors (debt and equity)?
• U.S. finance laws
• Transparency: tell us more about . . . .
• The U.S. Presidential election and the possible changes with the "change"

To keep you informed, we'll be blogging on a frequent basis during our stay in Europe.  If you have a favorite topic, or simply a question that you'd like us to ask during our trip, please "post" a comment for us.

(And yes, it is Oktoberfest in Munich.  Merely a coincidence. . . . )
 

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