Broker Warns About CMBS Modifications

DALLAS-Though it looked like a good idea in theory and on paper, attempts to acquire the 276-unit Forest Estates Apartments through assumption of its CMBS loan took close to a year to work through. In the end, the local buyer bought the class C apartment complex from foreclosure for $5.2 million.

Mart Martindale, senior director with Cushman & Wakefield of Texas Inc. brokered the transaction between the special servicer that the asset at 9655 Chimney Hill Lane and the local buyer. He tells GlobeSt.com that what he, the buyer and the special servicer encountered in trying to assume the Credit Suisse CMBS loan told him that, in the end, such an assumption may not be worth the hassle.

The $11.9 million loan was on the asset in 2006 by owner Jungel Bumi Ltd. of Houston, a partnership owned by CNC Investments. Three years later, the asset was in receivership, with a special servicer gaining control of management. The next step, Martindale remarks, was to put the complex on the market, which happened in March 2009.