Banking Misconduct Blog


Special Servicers – Do They Answer to Anyone? CMBS Post

Anyone commercial property owner facing a special servicer soon learns the deck is stacked. Many commercial loans today are securitized and packages into loan pools. These pools are sold to a trust that is owned by institutional investors. Unlike a bank that has offices and employees, a CMBS trust...

CMBS Mortgage Post – Mall Vacancies at Record High

As I write this post from my hotel room in Kingston, New York, a Toys R Us store sits empty in the parking lot across the street. Toys R Us is one of many big box retailers that have either closed completely or are going through a dramatic downsizing. For mall owners, that could mean...

From the Archives – CWCapital Sued for Libel, RICO

We are no fans of special servicers. At the top of our list of bad commercial loan servicers are CWCapital Asset Management (“CW Capital”) and LNR Partners. We have litigated complex CMBS cases against both companies, something few lawyers have done. Because our practice is so unique,...

Special Servicer LNR Partners Sued in Shopping Center Row

[Ed. Note - If you own a commercial property and find your loan has been transferred to a special servicer, READ THIS POST.]
The owners of a Ft. Wayne shopping center have filed suit against special servicer LNR Partners and others over a mortgage covering the property where the center is...

“Retail Apocalypse?” Words CMBS Borrowers Fear

It is a dangerous world right now for CMBS financed real estate investors. 2017 is expected to bring in a record number of defaults. Much of those defaults are simply the result of bad timing. Loans financed at the height of the real estate market in 2007 are coming due today. (Most CMBS borrowers...

CMBS Loan Modifications – Who Should You Call?

You are a borrower with a multimillion loan. The bank where you borrowed the money has long ago sold the loan to a Commercial Mortgage Backed Securities or CMBS trust. Worried about falling occupancy or even hoping for better terms, you decide to seek a loan modification. What should you...

Tick Tock... CMBS Crisis Looms (Lender Liability Post)

Rating agencies are sounding the alarm over the looming problems facing maturing CMBS loans. A large percentage of commercial mortgage backed securities (CMBS) financed loans were underwritten in 2006 and 2007 at the height of the real estate market. Those loans are coming due just as the...

LNR Partners - A "Cash Cow" (CMBS Special Servicer Post)

Yesterday Seeking Alpha published an article on Starwood Property Trust, the owner of embattled special servicer LNR Partners LLC. The article hails Starwood as a "cash cow" and worthy investment. Where does Starwood get much of its cash? From LNR.
LNR Partners is the nation's...

Many TIC & CMBS Financed Projects Facing Default

“Rearranging the deck chairs on the Titanic,” that is how I describe the many owners of real estate projects financed with CMBS or tenant in common structures. The ship is sinking, slipping under the surface, yet the party on the upper decks continues. Unfortunately, the folks most at...

Over One Third of CMBS Loans Could Default by 2017

Many CMBS loans are coming due in 2016 and 2017. Morningstar reports that almost half of the maturing Commercial Mortgage Backed Securities loans are overleveraged. That means that they are facing imminent maturity defaults.
According to a report published by Morningstar Credit Ratings, over...