Financial services firm Jones Lang LaSalle says it expects a strong uptick in loan sale outsourcing as investment and commercial banks and mortgage companies seek to tap unconventional debt buyers and loan participants to clear balance sheets given the lack of commercial mortgage-backed securities and collateralized debt obligation availability in today's capital markets.
‘While commercial loan delinquencies remain at fundamental lows, there is new loan sales activity emerging as investment banks and mortgage companies seek innovative ways to sell mispriced commercial loans that are clogging up their balance sheets and contributing to a slowdown in transaction volume,’ states Bart Steinfeld, managing director of Jones Lang LaSalle's real estate investment banking practice. ‘While we see many of the investment banks selling down loan positions by themselves, in the next four to six months, there will likely be a fair amount of performing but mispriced inventory left on the books, which will prompt financial institutions to engage in intermediaries to help in the disposition efforts.’
In the wake of the credit crunch, Jones Lang LaSalle is consequently expecting its loan sales services in the U.S. to include the management, valuation and liquidation of whole loans, B-notes, mezzanine pieces and lower-performing classified or distressed assets. Managing director Noble Carpenter has been appointed to spearhead the practice as part of the firm's real estate investment banking team.
Source: Jones Lang LaSalle
