The successful restructuring of a EUR 422 mln CMBS loan, secured on a portfolio comprising 159 predominantly retail German properties, and securitised under the 'Talisman 6' vehicle, sends a resassuring signal to the market that the refinancing of Europe's CMBS market has not collapsed as feared, special servicer Hatfield Philips said in a press statement.

The 'Orange' loan, the largest loan within the 'Talisman 6' CMBS, was previously facing foreclosure following an LTV breach and impending maturity, with no likelihood of repayment or refinancing at maturity.

'The extension of the Orange loan is an important milestone in the CMBS market as it indicates that all categories of lenders will support extending a loan if the borrower is fully committed to maximising the loan's performance,' said Michelet Romulus, asset manager, at Hatfield Philips. 'It also demonstrates that servicers are taking a very pragmatic approach, and, where appropriate, they will retain a loan that is in default in Primary Servicing thus saving costs for the CMBS noteholders.'

The Primary Servicing team of Hatfield Philips restructured the loan despite a continuing LTV breach, because the borrower was voluntarily pursuing all avenues to maximise the performance of the loan, including sales of properties and capex works to ensure the property portfolio did not decline in value.

The loan has been restructured in three areas in order to support both the lenders and the borrower and to ensure the maximum likelihood of recovery for all lenders. The restructuring includes a three-stage loan extension to 2014 based on meeting an agreed property disposal strategy; the scheduled amortisation of the loan as well as agreed capex work funded by surplus rental income.


The Talisman-6 Finance securitisation was completed in April 2007 and originally comprised nine commercial mortgage loans originated by ABN Amro Bank, of which the Orange loan was the largest with an original whole loan principal balance of EUR 439 mln and an original maturity date of 15 July 2011. The loan was secured on initially 165 primarily retail properties located in Germany which at the time of securitisation had an aggregate market value of EUR 549 mln.