Backshop owner CMBS.com expands its offerings in partnership with SitusAMC

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Sausalito, CA (Aug. 20, 2024) – CMBS.com, owner of the industry leading Backshop commercial real estate loan origination, management and servicing platform, today announced a strategic partnership with SitusAMC, a leading provider of services and technology to the commercial and residential real estate finance industry. As part of the partnership, SitusAMC will transition ownership of CLOSER, its CRE origination system, to CMBS.com. Additionally, SitusAMC will leverage the Backshop platform for its U.S. asset management services.

Combining Backshop and CLOSER

The partnership combines Backshop’s robust origination, asset management and servicing capabilities with CLOSER’s origination capabilities to establish a best-in-class platform that enhances users’ ability to originate, manage, model, and analyze their CRE portfolios.

“We are excited to bring the CLOSER platform and its team to Backshop. Together we will be the No. 1 most used CRE software in the industry. We plan a new interface that incorporates the best of both products to cement our leadership position. In addition to expanding our presence in the agency lending business, the SitusAMC business strengthens our foothold in the servicing part of the industry. Now deal data will flow transparently from origination, through servicing all the way to the lender and our class-leading bond analysis tools.”

– Jim Flaherty, Founder & CEO, Backshop

“This partnership, along with the planned efforts to integrate the best of both platforms, will establish a new standard in CRE software, creating a powerful platform to support CRE lending and management activities. We are excited about the value this will bring to the market and look forward to supporting the future growth of Backshop.

– Michael Franco, CEO, SitusAMC

Backshop was the first web-based software application to model the entire deal stack including properties, debt, equity, and bonds. The platform’s underwriting and asset management capabilities bring transparency that enables lenders and investors to make smarter, faster and more profitable decisions.

CLOSER is a comprehensive loan origination system, streamlining the origination and management of commercial real estate secured debt. The platform has a strong hold in GSE and CMBS markets, supporting ~35% and 20%, respectively.

Enhancing SitusAMC’s Asset Management Offering

SitusAMC is a leader in commercial real estate debt servicing and asset management. The firm manages more than $433 billion of unpaid principal balance across the U.S. and Europe (as of 12/31/23). SitusAMC supports its clients which are comprised of top banks, insurance companies, pension funds, asset management firms, as well as REITS and Private Equity funds. As part of the partnership, SitusAMC will onboard the Backshop platform to support and enhance the firm’s asset management offering.

“Backshop’s robust asset management capabilities will provide the tools our asset managers need to support our clients’ portfolios and fuel strategic decision making. We look forward to onboarding the software and continuing to deliver exceptional outcomes for our clients.”

– Anne Jablonski, Head of CRE, SitusAMC

About SitusAMC  

SitusAMC is the leading independent provider of innovative, trusted solutions that support the entire lifecycle of commercial and residential real estate finance, powering more efficient, effective, and agile businesses. For more information, visit www.SitusAMC.com.

About CMBS.com

Founded in 2000, CMBS.com provides commercial real estate valuation, pipeline, loan origination, asset management, and securitization management software. The firm’s flagship platform, Backshop, is the leading CRE loan origination, management and servicing platform supporting a range of CRE market participants. CMBS.com is also an authorized third-party data provider to the CMBS industry.

Contact

Jim Flaherty
Founder & CEO, Backshop
jim@cmbs.com

CMBS 4.0 project announced at CREFC Conference, which was surprisingly upbeat

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I just returned from New York from the annual CREFC conference. Compared to the last gathering in January 2024 in Miami, the mood was generally glass-half-full.

Maybe everyone was in a good mood because the trade organization was celebrating 30 years, or because Trevor Noah did an amazing job talking about the power of diversity to a room full of bankers. But I think it had more to do with the CMBS new issuance market having its moment. With the banks and private lenders pulling back, the CMBS market has been filling the void and having a good year — especially traditional conduit.  So, with all the concern about SASB losses and obsolete office buildings, the traditional conduit market remains open.

The most interesting thing was a new project called CMBS 4.0. From what I understand, CMBS 4.0 is the trade group looking at how it works and committing to improving. CREFC pursuing change is a very positive development. I will get involved to see if there is any appetite to include rent roll disclosure and an updated data format for the IRP as part of the project. Maybe the risk in office loans is enough to motivate the change?

Jim Flaherty

Checking in on 9/11

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Today marks the 22nd anniversary of 9/11 and the 15th anniversary of this blog. If you read the first post you’ll see how the events of 9/11 are part of our founding story:

The history of Backshop and CMBS.com

The anniversary of 9/11 always gets me thinking about the formation of this company and the state of our industry.

The CRE debt markets have been slow with higher interest rates, rising costs, and decreasing values. It is possible, if we get another significant down cycle and bond losses, there could be an opportunity to revisit the IRP disclosures. Rent rolls are key to understanding risk, especially for an office building, where there is high risk for severe losses. Right now seems like the calm before the storm.

Jim Flaherty

Automate your quarterly CMBS servicer reporting

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I hope this post finds you healthy, prosperous and vaccinated. Gratefully, we are all three here. There’s been a lot going on, and I’ve not posted in a while, so here is the update.

We launched our dedicated tool for CMBS borrowers to support their quarterly servicer reporting requirements. If you have a CMBS loan, you can easily find your loan in our CMBS database, then we pre-load all the loan, servicer and property information — including all the operating statements that you have submitted to your servicer.

So, if you have had your CMBS loan for 5 years and you sign up for CMBS.com, once you find and load your deal, you will see 20 operating statements (4 per year for 5 years). For your 21st submission, modify the last one you sent and send in the new one through our system. Going forward, the process will be automated.

For rent rolls, since they are not part of the IRP, you will have to upload the first one and then let our tool automate it from there.

For more details about automated quarterly CMBS servicer reporting, check out our help pages for CMBS Borrower Reporting.

Speaking of rent rolls, if you are a reader of this blog you know I believe they need to be disclosed as part of CMBS transactions, and it turns out I am not the only one. In my last post, I talked about the whistle blower complaint and the University of Texas study about lenders inflating the income on properties. I recently came across this interview. Starting at about 3:30 is a pretty good description of how CMBS “liar loans” are made.

To be clear, using our new CMBS borrower reporting tool does not mean your rent rolls will be disclosed to the investors or the public. It just automates the submission to your servicer, who will only disclose what is in the IRP. But the issue of rent roll disclosure is a story that is not going away.

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Jim Flaherty is CEO of CMBS.com and the creator of the Backshop loan origination system. He is a trained credit professional with experience installing enterprise underwriting systems for commercial real estate lenders and investors.

Checking In on 9/11

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Today marks the 12th year I’ve been writing this blog, which I started to provide an inside perspective on how financial reform would affect the CMBS finance markets and, more importantly, provide commentary on how it should. In my opinion, data transparency is the single most important factor in ensuring the markets stay fair, honest and healthy — and the most important tool to prevent a repeat of the 2008 financial crisis.

The reforms that were ultimately included in the 2014 Dodd-Frank Act did about everything but require full transparency. They put in things like risk retention, rating agency reform and better disclosures, but they came up short on requiring the single most important item: information on the lease payments (the rent roll).

The big-picture result of Dodd-Frank has been to effectively “deleverage” the CMBS structures. The percentage of the pool rated as junk bonds is now bigger, and the less risky AAA bonds form a smaller percentage, which creates bigger credit support levels. It also effectively pushed out the smaller, undercapitalized players because of the new capital and regulatory requirements. Most CMBS loans are now originated by the top 5 banks. All have seemingly gone well for the last several years with generally increasing originations, low loss levels, and the industry earning back its reputation.

Now we are being tested again because of the negative impact the pandemic is having on both CRE in general and CMBS specifically. In August an article in the Wall Street Journal called out that the lenders were inflating the revenue of properties to make the loans look less risky, according to an academic study and a whistleblower complaint to the SEC summarized as follows:

“A study of $650 billion of commercial mortgages originated from 2013 to 2019 found that even during normal economic times, the mortgaged properties’ net income often falls short of the amount underwritten by lenders. The underwritten amount should be a conservative estimate of how much a property earns. Instead, the actual net income trails underwritten net income by 5% or more in 28% of the loans, according to the study of nearly 40,000 loans by two finance academics at the University of Texas at Austin.”
– Wall Street Journal, August 11, 2020

Here is the full story.

The industry responded forcefully with a six-page defense of the current practices and basically said the study was flawed. They said current delinquencies are being caused by the pandemic, not bad underwriting. Download the industry response.

While I agree with the CREFC premise that underwritten income does not always match in-place income, CREFC fails to concede that, if there is a difference, investors and rating agencies deserve to know. Why is it different? Which loans? Then investors can make informed decisions.

Rent roll disclosure would accomplish this.

Today is also the 19th anniversary of 9/11, and as I finish up this post I am listening to Bruce Springsteen’s “The Rising,” top to bottom. The album always gets me and reminds me of how we only get one trip through, there are no guarantees, and you need to make the best of the ride by living an honorable life.

I remember post 9/11, the tragic events caused people to be more empathetic, respect our first responders, be unified, and were generally inspired to live honorably.

The financial crisis of 2008 did bring meaningful reform that successfully de-levered the system, making us better prepared for this Covid-induced down cycle. Professionally, my “honorable” cause is trying to make CRE finance markets better by enabling transparency at the system level and promoting the merits of opening the data to my industry peers. I’ll do my part to try and make one of the unexpected positives of Covid be triggering the final step in CMBS transparency.

I hope you all stay safe and healthy.

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Jim Flaherty is CEO of CMBS.com and the creator of the Backshop loan origination system. He is a trained credit professional with experience installing enterprise underwriting systems for commercial real estate lenders and investors.

CMBS.com is a Winner of the Most Prestigious Award in Commercial Real Estate Tech

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CMBS.com celebrates great achievement in the Real Estate Tech Awards (#RETAS)

New York, NY (September 5, 2019) — CMBS.com, CRE Software and CMBS Data for Property Owners and Professionals, is pleased to announce that they are a Sixth Annual Real Estate Tech Awards (#RETAS) winner in the Information & Intelligence category presented by CREtech, the largest event, data and content platform in the commercial real estate tech industry.

Sponsored by JLL Spark, the Real Estate Tech Awards (#RETAS) are the leading international award honoring excellence in commercial real estate tech. The awards recognize the most cutting-edge companies who have played an integral role in advancing tech in the industry throughout the year. Backed by the leading VCs, angel investors, corporate investors and thought leaders in the commercial real estate tech industry, the awards were open to startups or technology companies servicing the industry. 

CMBS.com was carefully selected as a winner by the #RETAS elite panel of judges, including the leading VC’s, Angel Investors, and Corporate Investors and Thought Leaders in the commercial real estate tech industry.

CMBS.com provides full-stack deal modeling and CRM for property owners and professionals. Driven by the same engine as Backshop enterprise software, CMBS.com is available on a monthly or yearly subscription. 

“We appreciate CREtech’s recognition of our platform by selecting us a RETAS winner,” said CMBS.com founder and CEO Jim Flaherty. “After spending 15 years developing our platform with leading CRE enterprises, we look forward to bringing the same efficiencies to CRE professionals and property owners, especially owners who have a CMBS loan.” 

For more information about the Real Estate Tech Awards, click here.

About CMBS.com

Backshop and CMBS.com have been in business since 2000 and have become a premier commercial real estate software and data company.

Backshop enterprise software facilitates online life of the deal management and is used by all types of originators and asset managers including private equity funds, banks, insurance companies, REITS and CMBS players.

CMBS.com retail software is used by brokers, owners and other commercial real estate professionals to find, value and transact CRE deals resulting in smarter and smoother online deal making.

Our major “break-through” is providing web-based analytical tools that underwriters use to run property, debt and equity cash flows for all different types of commercial real estate properties.

CMBS.com and Backshop are based in beautiful Sausalito, CA.

About CREtech

CREtech is the leading media and events company servicing the greater real estate and technology community. Our mission at CREtech is to connect the real estate and tech sector by hosting engaging conferences, publishing research, and content.

CREtech is owned and operated by The News Funnel, the leading content, connectivity and event platform devoted to the commercial real estate industry.

To learn more about becoming a sponsor, a list of upcoming events and other exciting news, please click here or email anne@cretech.com.

 

Join the data revolution: CMBS data, CRM and full-stack deal modeling for all CRE players

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With the launch of our new Professional software, we’re making the power of our Backshop enterprise CRE platform available to individuals and small groups.

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CREFC West Coast Conference and SailGP

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I just returned from Santa Monica, CA where I attended the CREFC West Coast Summit to get an update on the market.

The main takeaway: The low rate, high value environment will likely stay for a while, but investors are weary because the cycle is so old.

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2019 is off to a hot start

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I’m leaving Miami after attending the annual CREFC Investor Conference. The conference, now in its 25th year, is usually the best place to find out what people are thinking and get a prediction for the year. We had great weather, and a friend of mine hosted me on a nice-sized boat to cruise around Miami Bay — making the trip that much nicer.

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Announcing our College Securitization Analysis Contest

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We’re excited to announce our first college securitization analysis contest. Model your chosen securitization using our data and tools — and win $2,500.

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