Faulty fundamentals and inadequate liquidity make refinancing more than $1 trillion in commercial real estate (CRE) maturities a short-term concern for local and regional banks. Commercial real estate mortgage volume not able to obtain refinancing in the next 24 months is "staggering," said Gerson Lehman Group, New York, in a recent analysis, Commercial Mortgage Refi Dilemma Much More than CMBS Issue. "In many cases, the only financing available to either the current borrower or a take-out borrower--a new owner taking over the troubled asset--will be the existing lender, but such refinancing will only happen where the lender is both willing and able to make a new loan," the report said. "As a result, the market can expect to see a very high volume of unwanted or forced transactions, with limited financing to go alongside the equity capital that has accumulated to take advantage of market opportunities."
