Signs of life in CMBS

The market for commercial mortgage backed securities was killed off in 2008, but five issues worth $9.4bn have been seen in Europe. However, the issues are rumoured to be a means of gaining access to European central bank funding.

The crushed market for commercial backed real estate securities (CMBS) has seen some signs of life, according to the latest issue of Global Capital Trends by Real Capital Analytics.

Real estate data provider RCA says 95 percent of the market was killed off in 2008. However, so far this year, there have been five CMBS issues in Europe totalling $9.4 billion, with one large CMBS issue in the US.

The five issues in Europe were led by Barclays Bank, which issued a $5.1 billion floating rate issue of loans backed by French and German properties. Those European issues are rumoured to be structured as collateral to gain access to European Central Bank funding. But, RCA says, “the fact they were issued at all is significant nonetheless”.

The CMBS issue in the US was by Anglo Irish Bank. The properties were mostly office buildings.