A new report from the CoStar Group examines the trends and latest information yielded from the April CMBS bondholder remittance reports to evaluate the state of CMBS loans, which now see to be rebounding to pre-recession levels. Data shows that net operating incomes on almost all yearly vintanges of CMBS loans are now near or above underwritten financial levels. An excerpt follows:
Based on the loans that have reported year-end 2012 financials, NOI growth was strong in 2012 rising 4.5% on average. For the 2010 and 2011 vintages about 30% of the loans reporting year-end 2012 financials are showing lower NOI than was underwritten. The 2012 vintage is showing a higher percentage, with around 40% of the loans having lower NOI compared to the underwritten amount.
While they plan to revisit the topic again in a few months once the majority of the loans have reported, based on the early look at NOI (net operating income) trends among loans that have reported year-end 2012 financials, Jan de Beur said NOI growth was strong in 2012, rising 4.5% on average.
"While preliminary, the 2012 NOI growth rate is noticeably higher than the 3% increase in NOI experienced in 2011 on average," said Marielle Jan de Beur, managing director and head of Structured Products Research CMBS and Real Estate Research for Wells Fargo Securities.
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