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April 28 (The following statement was released by the rating agency)
Loss severities ticked up slightly for U.S. CMBS year-over year while the pace of loan
resolutions fell, according to Fitch Ratings in its latest annual CMBS loan loss study.
Average loss severities rose to 51.2% in 2013 from 50.5% in 2012. 'Special
servicers are continuing to resolve many over-leveraged CMBS loans with most of
them still coming from the peak years of 2005-2007,' said Managing Director Mary
MacNeill. Fitch expects the pace of CMBS loan resolutions to remain constant
this year while average loss severities should remain stable compared to 2013.
Special servicers resolved 872 loans, totaling $16.4 billion in Fitch-rated CMBS
in 2013, a decrease of over 28% by number when compared to the 1,219 loans
totaling $16.6 billion resolved in 2012. 'Special servicers were able to resolve
many CMBS loans that had been languishing in special servicing for several
years,' said MacNeill.
As for specific property types, retail had the highest average loss severity in
2013 at 62.1%. This represents a 14.5% increase from the 2012 loss severity of
54.2%. 'The 11 largest CMBS losses in 2013 were each in excess of $50 million,
with eight coming from retail properties,' said MacNeill. Conversely, hotels and
multifamily loans (both at 36.8%) showed the greatest decline in loss severities
compared to 59.8% and 42.7%, respectively, in 2012.
Fitch's 'U.S. CMBS Loss Study: 2013' is available at 'www.fitchratings.com' or
by clicking on the below link.
Link to Fitch Ratings' Report: U.S. CMBS Loss Study: 2013 (Loss Severity Stable
as Volume of Resolved Loans Contracts)