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German Office Portfolio Loan Gets Big Appraisal Reduction

According to a special notice received on 2/Apr/2014, the appraisal value for the Tishman German Office Portfolio loan was decreased by €89.40 million. The loan is the largest in EURO 28 with a current balance of €244.97 million. The loan, which is backed by office properties in Germany, is expected to mature on 7/Feb/2015.

The loan’s initial securitised balance was €378.96 million. The loan was valued at €599.20 million at origination, and its most recent valuation was €273.80 million as of 1/Nov/2009. Based on yesterday’s notice, the loan is now valued at €184.40 million as of Nov/2013. The updated valuation was received following the execution of a New Telekom lease and leasing activity at the Westend Caree property. The updated valuation gives a current LTV of 132.85%.

The Tishman loan was put on WatchList this February due to ICR of 0.84, which was in breach of an ICR covenant of 1.25. However, debt service shortfall was covered by an equity injection from the borrower. The borrower also entered into business plan amendments on 21/Nov/2013. The maturity date was extended one year, from Feb/2014 to Feb/2015.

If the loan were to be sold at its updated appraisal value, it would see a loss of approximately €60.57 million. Classes G, F, and E would be written off completely, and 22.12% the D Class would be written off (approximately €16.64 million).

Deal Name: EURO 28  Loan Name: Tishman German Office Portfolio
Special Notice
Updated valuation of €184.4m as of Nov/2013; Pre-implementation Valuation of €158.1m as ofAug/2013 prior to conclusion of Implemented Asset Management Initiatives.

Deal Name: TMAN 7  Loan Name: GB Mozart
Special Notice: SPA entered into for Bonn property on 9/Jan/2014 for gross sale price of €24m

Compliments of TREPP, LLC – A EACCNY Member