All Investors Await Distressed Assets to Become Available, Financial Institutions Practice Patience

Distressed properties unlikely to resemble discounting following the global financial crisis due to the prevalence of loan originations through banks. CMBS only represents 14 percent of outstanding debt, limiting the number of assets where loan servicers lack flexibility. Nonetheless, several funds are forming to enter the market when distress eventually emerges.

Key Features Include:

• Congress pressuring the Fed to give CMBS servicers more discretion

• Debt funds may emerge as a focus of distressed properties

• Billions raised to target REO assets

• Private investors likely to see opportunities in hospitality and seniors housing