The Treasury, Federal Reserve Board and FDIC released a joint update on the Public Private Investment Program (”PPIP”).  Please find the entire release here (including the conflict of interest rules, FAQs, and letter of intent and term sheet):  http://www.financialstability.gov/latest/tg_07082009.html.  The key development in this update is the announcement of nine asset managers for the Legacy Securities Program (the “LSP”):

• AllianceBernstein, LP and its sub-advisors Greenfield Partners, LLC and Rialto Capital Management, LLC;
• Angelo, Gordon & Co., L.P. and GE Capital Real Estate;
• BlackRock, Inc.;
• Invesco Ltd.;
• Marathon Asset Management, L.P.;
• Oaktree Capital Management, L.P.;
• RLJ Western Asset Management, LP.;
• The TCW Group, Inc.; and
• Wellington Management Company, LLP.

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The Federal Reserve Bank of New York announced today that the initial CMBS TALF subscription window will open on June 16, 2009, with funding to occur a week later, on June 23, 2009.  Eligible collateral is currently limited to AAA-rated CMBS issued in 2009, with underlying mortgages originated on or after July 1, 2008.  TALF borrowers can elect either a 3-year or 5-year loan term.  Haircuts and interest rates vary depending on the loan term and remaining average life of the subject CMBS, as shown on the FRBNY’s official announcement:  http://www.newyorkfed.org/markets/cmbs_operations.html

The updated TALF term sheet can be seen here:  http://www.newyorkfed.org/markets/talf_terms.html

The update TALF FAQ can be seen here:  http://www.newyorkfed.org/markets/talf_faq.html

In Goodwin Procter’s November 2008 Real Estate Capital Markets Advisor, we presented thoughts on the then current economic environment relating to the commercial real estate industry, focusing principally on mortgage debt. In particular, we summarized the state of the CMBS market, outlining (i) the volume of scheduled maturities over the near term; (ii) the relatively modest delinquency rate on CMBS loans at that time; and (iii) the U.S. Treasury’s then stated intention to use the Emergency Economic Stabilization Act of 2008 to provide capital infusions into the financial system and not to purchase troubled debt. We also provided input on recent changes in the REMIC provisions relating to RMBS pools, and how similar changes could benefit the CMBS market. [Read more →]

In Goodwin Procter’s November 2008 Real Estate Capital Markets Advisor, we presented thoughts on the then current economic environment relating to the commercial real estate industry, focusing principally on mortgage debt. In particular, we summarized the state of the CMBS market, outlining (i) the volume of scheduled maturities over the near term; (ii) the relatively modest delinquency rate on CMBS loans at that time; and (iii) the U.S. Treasury’s then stated intention to use the Emergency Economic Stabilization Act of 2008 to provide capital infusions into the financial system and not to purchase troubled debt. We also provided input on recent changes in the REMIC provisions relating to RMBS pools, and how similar changes could benefit the CMBS market. For more information click here.