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April maturities for €2.2bn of CMBS loans

More than €2bn worth of European CMBS loans made at the peak of the market are due to mature in April, Fitch Ratings said today.

Some 23 loans worth €2.2bn will mature this month. Almost 60% of those loans are serviced by Capita Asset Services.

Fitch has estimated that more than half of all European commercial mortgage-backed securities (CMBS) made in 2006 and 2007, shortly before the market froze, will default when they mature.

Around 80% of loans made in 2004 or earlier have been repaid in full – largely because they had greater equity when they matured.

In contrast, the majority of 2006 and 2007 CMBS loans that have reached maturity are outstanding. “On the whole, LTVs are too high for them to be refinanced outright, and in some cases negative equity rules out sponsor cooperation,” Fitch said.

Euan Gatfield, managing director at Fitch, said he expected impending defaults to trigger more asset sales.

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