Ladies and Gentlemen, please buckle your seat belts as we are expecting a bumpy ride.

The results of the 2015 CMBS maturity payoffs are in.  2015 was the first year of the infamous “three year wave” of CMBS maturities.

There was a total of $60 billion in CMBS loans that matured in 2015.  85% of those loans paid off and the remaining 15% ($12 billion) did not.  This was better than originally expected and this was primarily driven by the incredibly low interest rate environment and the over abundance of higher leverage capital in the marketplace.

The $12 billion of CMBS loans that did not pay off were either extended or are in special servicing.

Morningstar Credit Ratings, LLC projects that this positive trend will not continue throughout the next two years of the “three year wave”. There is currently $80 billion of CMBS loans maturing in 2016, and it is projected that only 65% of these loans will be able to payoff at maturity.  Then in 2017, there is another $103 billion maturing, with only a projected 50% being able to payoff at maturity.

By all accounts, 2016 is projected to be a bumpy ride for CMBS, so be sure your seat belts are buckled!

And don’t wait too late to understand all your options if you have a loan maturing in 2016 or 2017.  12 months ahead of the maturity date is the best time to have a consultation call to begin to understand your options.