CMBS Market Facing Possible Correction

The commercial mortgage securitization market finds itself in a market correction, facing a situation of excess supply of inventory that needs to be sold. Also borrowers are wary of today's rates considering that spreads have widened considerably.

And this period of adjustment, for the excess inventory to be exhausted and new loans to be made, could last another year.

This also presents an opportunity for portfolio lenders. The process of correction in the market was set off by a Moody's memo about overly aggressive underwriting in mid-April, according to Darcy Stacom, vice chairman, investment properties institutional group, CB Richard Ellis.

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