When slogging through individual workouts, special servicers often encounter unforeseen obstacles such as faux-bidders or contentious borrowers. Yet as the pipeline of defaults grows ever larger, special servicers are forging ahead and emerging as major sellers in the distressed market.
Four of the largest special servicers recently made offerings of debt/REO on a bulk basis. These deals may serve as an indicator of what long-patient buyers can expect in the months to come. For example, CWCapital Asset Management, which has already traded $500 million of defaulted CMBS loans, has another seven loans with a par value of$115.6 million being marketed through Mission Capital Advisors.
At the start of the year, New York City-based Centerline Capital Group Inc. marketed a $307-million portfolio of non-performing loans and REO through the Carlton Group's auction format. According to Fitch Ratings, the firm has the highest percentage of loan value recoveries, clocking in at 67.1 %.
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