It could be that this is just a new version of CMBS and we can look forward to CMBS 2.1 and so on. However, the 2.0 moniker appears to have passed into common usage as meaning new or up to date and there has been a flush of revamped ideas and products afforded this soubriquet – often without justification.
The industry trade group that controls the reporting standards for CMBS reporting - the CRE Finance Council – have increased the data disclosure provisions for 2.0 but to a standard that still falls well short of enabling individual investors access to full data on rents for example.
In line with the new, improved CMBS 2.0 standards, Deutsche Bank is attempting to securitise and sell a £300m loan behind the acquisition of Chiswick Park in London by Blackstone. This is seen widely as a touchstone for the state of the European CMBS market – moribund since the financial crisis.
High quality, single asset deals like this with a simple structure have seldom been a problem. The asset upon which the debt is secured is clear to all participants and they are able to apply their own appetite for risk to the deal. However this is a long way from the third tier syndicated tranches of debt where the provenance is significantly less clear and the risk appreciation is similarly muddied.
In the US, new issuance of CMBS has begun to recover but the European market remains cautious for good reason. There is an estimated €12 billion of CMBS due to mature in 2011 and this will need to be refinanced.
According to Standard & Poors only one out of the seven European CMBS loans scheduled to mature in February met its maturity obligation. This reinforces the 2010 trend that saw European CMBS showing a greater propensity to face problems on maturity. S&P notes that of the 80 loans scheduled to mature in 2010, only 30 repaid in full.
It is no wonder that circumspection prevails and this makes the short-term, multi-asset, floating rate CMBS issue beloved in the mid-noughties unlikely to feature on the European landscape any time soon despite the 2.0 tag.
Perhaps CMBS itself should move on. Web 3.0 is the semantic web. This is a "web of data" that enables machines to understand the meaning of information. In turn this implies massively more transparency of data than is evident under Web (or CMBS) 2.0
