Moody's, Torto to Offer CRE Software

Moody's Investors Service and Torto Wheaton Research, Boston, have teamed up to offer software for analyzing the risk associated with commercial mortgage whole-loan portfolios.The software, Moody's Commercial Mortgage Metrics, will allow holders of whole-loan portfolios to analyze the risk of the portfolios based on standards that are used to analyze their other fixed-income holdings, the companies said. Tad Philipp, a managing director in the commercial mortgage-backed securities group at Moody's, said commercial real estate lenders will be able to find out the probability of default of their loans and the loss that might be sustained if a default occurs. Using commercial real estate inputs such as loan-to-value ratios and debt service coverage ratios, the software produces outputs that bring commercial mortgage analysis closer to "the advanced techniques currently being used to analyze corporate credit risk," Mr. Philipp said. Lenders can also draw on the Torto Wheaton property market database to get additional property-level information. A Web-based portfolio version of the software is scheduled for the first quarter of 2004, the companies said.