Debt Valuation Market Update Q3 2020

Today’s leading commercial real estate (CRE) investors have followed a three-step process to optimize the management of their debt by minimizing operational and data integrity risks, portfolio blind spots, and time-intensive processes.

The information presented in this report represents average credit spread conclusions segregated by property type and grouped by LTV for the quarter ending September 30, 2020.

Please use this form to request your copy of the Q3 2020 Average Market Credit Spreads report from Chatham.

Recent changes in the EPRA NAV measures have led many CRE borrowers to include a valuation on their debt portfolios. The following commentary summarises the changes, and how Chatham is assisting clients in this valuation and reporting process.

In reviewing what has transpired in the commercial real estate (CRE) lending markets over the past six months, we found it helpful to re-read our market commentary as it was written at the end of each of the last three quarters.

Commercial real estate (CRE) professionals are turning their attention toward technology to optimize workflows and focus on the core of their business: managing properties/portfolios and generating returns.

Chatham Financial is the largest independent financial risk management advisory and technology firm. A leader in debt and derivative solutions, we provide access to in-depth knowledge, innovative tools, and an incomparable team to help mitigate risks associated with interest rate and FX exposures.

Real estate market participants remain cautious, requiring significant areas of judgement in quantifying updates to cash flow modeling and discount rates.

The purpose of this document is to provide a framework for understanding best practices in marking debt to market for the purpose of financial reporting. This document is focused on clarifying policy and practice nuances related to debt valuation.