Office, retail borrowers to face refinancing woes

Retailers looking to refinance in New York City could have a hard time over the next few years, thanks to a flood of commercial mortgages due to mature that lenders will need to refinance.

Commercial mortgage-backed securities make up one-fourth of the nearly $1.4 trillion in U.S loans set to mature between 2013 and 2017, according to a year-end report for 2013 by CMBS analytics company Trepp. Northeast states, including New York, New Jersey, and Connecticut, have about $100 billion in loans set to mature during that time period and could be the hardest hit region, the report says.

Office and retail borrowers are expect to face the worst borrowing climate, “barring significant property value appreciation or a loosening of underwriting standards,” the report says.

The outlook for hospitality and multifamily borrowers is better, with many recently originated multifamily loans already at the loan to value ratio of those made during the boom years of 2004 to 2007, according to the report. [NYO] — Angela Hunt