Fed: TALF Bailout Program Gets Extended Until March of 2010

August 17, 2009 by · Leave a Comment
Filed under: Policy News 

Here is the first piece of commercial real estate bailout that I have been expecting.  In this AP news piece, they mention that the Term Asset-Backed Securities Loan Facility program has been extended to cover CMBS (Commercial Mortgage Backed Securities).  It mentions that that creating CMBS takes time and March 2010 is not that far off so we can either expect another extension or another program that would be more direct to the commercial mortgage industry to get the money more directly.

News (Associated Press):

The Federal Reserve has extended the length of a program intended to spur lending to consumers and small businesses at lower rates, but the central bank said it had no plans to expand the types of loans being made.

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Commercial Real Estate gets Bailout Funds thru TALF

May 4, 2009 by · Leave a Comment
Filed under: Real Estate News 

Called it, this is the first step with more to come.   The Term Asset-Backed Securities Loan Facility or TALF is now extending its program to cover CMBS or Commercial Mortgage Backed Security.  Here is what I have to say about it and a link to the press release.

Fed offers TALF lifeline to commercial real estate industry




Commercial-mortgage bond risk rises after loan delinquencies

November 19, 2008 by · Leave a Comment
Filed under: Real Estate News 

Looks like the next shoe to drop will be the commercial real estate market.  It has lagged behind the residential market but it is not immune by any stretch.  Looks like you need 700 basis points (7%) to get debt insurance (CDS) on a CMBS (Commercial Mortgage Backed Security).  

Just today, the premium rose, 1.3%.   With businesses either shutting down or cutting back on their expenses, this will have a direct effect on the commercial real estate market.   If you have been following the CoStar newsletter that tracks the commercial market, they have not had a rosie picture for our current real estate market either.  Time to batten down the hatches.


The cost to protect top-rated commercial-mortgage bonds against default rose to a record, a day after two bad loans boosted concern the debt will cause losses.

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U.S. commercial mortgage-backed bond yields soar

November 14, 2008 by · Leave a Comment
Filed under: Real Estate News 

No surprise that now we are waking up to the fact that we are facing a serious recession, the commercial real estate market is finally starting to lag, prices are declining and risks on the bonds are rising.  This in turn, means investors are demanding higher returns if they are going to invest in any Commercial Mortgage Back Securities (CMBS).  According to Reuters, some bonds are being quoted at a huge 12% yield.


Yield premiums on bonds backed by office buildings, stores and hotels soared to record highs this week as concerns about economic growth and doused hopes for a federal asset purchase program plagued the market.

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