Euromoney Training
Workshop on
Commercial Mortgage-Backed Securities
presented by
Professor Ian Giddy
New York University
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What the Course is About Method
and Schedule Who Should Attend? The seminar is of relevance to both potential originators and investors in commercial mortgage-backed securities: property finance professionals, commercial lenders and investment bankers, securities analysts; investment officers and fund managers; real estate developers and other individuals whose professional future may be enhanced by an understanding of CMBS techniques. Issues
to be Discussed
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| Day | Topics |
| Day 1 |
Securitzation Finance Overview of the global market How ABS deals are structured Key legal issues in MBS, CMBS and REITs Rating securitizations Commercial Mortgage Securitization Residential MBS Commercial MBS: retail, office, multifamily, hotels, etc Legal structures Single-property securitization Single-borrower/multi-borrower CMBS CMBS conduits Highly leveraged CMBS Sale-and-leaseback structures Rating of Commercial MBS Key risks: default and recovery, prepayment/extension, liquidity Gaining security interests in the loans and the properties Analysis of commercial mortgage loan pools Loan analysis and cross-collateralization Stress testing mortgage defaults CMBS modelling Understanding waterfalls and prepayments in CMBS Call protection DIversification in the pool -- what factors? Servicing: subservicer, master servicer, special servicer |
| Day 2 |
Credit Enhancement in CMBS Methods of credit enhancement Concepts of LTV in CMBS Senior-subordination credit support Spread and reserve accounts; liquidity facilities Funding the residual Understanding and managing the balloon payment risk in CMBS Default and workout Multi-Tier and Super-Senior CMBS Why have a multi-tier funding structure? Senior, mezzanine, subordinate AAAs Planned balance classes Interest-only classes Synthetic CMBS True sale versus synthetic: the choice Role of credit derivatives in the CMBS market Applications Structuring and Pricing a CMBS deal Steps in setting up the structure Getting a rating Placing the debt Exercise: arranging a deal. Teams negotiate the credit enhancement and financing of a pool of commercial property loans. Pricing the securities Understanding the economics Conclusion |
Belenus: A French Property Loan Securitization
Bear Stearns Commercial Mortgage Trust
Wachovia Bank Commerical Mortgage Trust
Perseus UK Commercial Loan Conduit
Castenea Synthetic CMBS
European Property Capital Hybrid CMBS
Background Reading
Anthony Sanders, Commercial Mortgage-Backed Securities
S&P, CMBS Property Evaluation Criteria
Fitch, Securitization of Sale and Leasebacks
CMBS Documentation
Sample commercial mortgage agreement
Sample leasehold agreement
Sample intercreditor agreement
Sample closing checklist
Sample CMBS documentation checklist
Glossary of CMBS terminology
Workshop Instructor
Ian Giddy is on the faculty of finance at New York University, USA. He has taught finance at NYU, Columbia, Wharton, Chicago and abroad for the past thirty years. He was Director of International Fixed Income Research at Drexel Burnham Lambert from 1986 to 1989. The author of more than fifty articles on international finance, Dr Giddy has served at the International Monetary Fund and the U.S. Treasury and has been a consultant with numerous financial institutions and corporations in Europe, North America, the Middle East and Asia. He has lectured in more than forty countries, and has been involved in the asset-backed securities market for over 15 years. He is the author or co-author of The International Money Market, The Handbook of International Finance, Cases in International Finance, Global Financial Markets, Asset Securitization in Asia, and The Hudson River Watertrail Guide.