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Commercial Mortgage Debt in Distress Surges 320%, Moody’s Says
More than $54.3 billion in U.S. commercial mortgage backed securities have been transfered to loan workout specialists mostly because of payment delinquencies, a 320% increase since the start of the Covid-19 pandemic, according to Moody’s Investors Service. Hotel and retail properties, the sectors hit hardest by restrictions on travel and public gatherings to reduce virus transmissions, make up the vast majority of the debt transferred to special servicers.
“These loans currently account for 89% of the special servicing balance, though loans for mixed-use properties, at 5%, generally include a retail and hotel component,” Keith Banhazl, a Moody’s managing director, said in a statement. Loans transferred to special servicers may end with a payment modification or foreclosure, resulting in losses for bond holders that are likely to increase if the economic downturn lasts long. About $4.2 billion in distressed loans transfered out of special service since March as borrowers reached temporary agreements to defer payments or caught up on delinquent debt as business rebounded. Several of the largest real estate investors have stopped paying hotel and retail debt while soliciting billions of dollars from new investors for property opportunities that emerge out of the crisis. The rate of severely delinquent loans more than 121 days late nearly tripled in August, jumping to 2.3% from 0.8% in July. Short-term delinquencies declined in August as borrowers entered forbearance agreements or caught up on past debts.Smaller loans bundled in portfolios, known as conduit CMBS, accounted for $5 billion of the $5.4 billion of loans transfered in August to special servicers. Since March, $25.1 billion of conduit loans were transferred to workout specialists. Office properties made up only 3% of special servicing loans. The $1.39 billion debt on the Mall of America is the largest single-loan in special service.
Moody’s downgraded one slice of the debt on Tuesday to A3, while still maintaining its rating of all slices of debt at investment grade.
https://www.bloomberg.com/news/articles/2020-08-25/commercial-mortgage-debt-in-distress-up-320-since-march-moodys
downgrade a small tranche so they keep the rest of it "investment grade".
Apple CEO-Tim Cook sold: $131.76m-August 25
Apple stock split leads to major Dow Jones shake-up: Exxon is out, Salesforce is in
The S&P Dow Jones Indices announced a major shake-up for the Dow Jones Industrial Average on Monday, switching out three stocks for the second time in a decade and the third time in this millennium. On the 30-stock, price-weighted Dow Average (DJIA) cloud-based customer relationship-management software company Salesforce.com Inc. (CRM) will replace oil giant Exxon Mobil Corp. (XOM) , biotech drugmaker Amgen Inc. (AMGN) will replace pharmaceutical company Pfizer Inc. (PFE) , and software and industrial conglomerate Honeywell International Inc. (HON) will replace defense contractor Raytheon Technologies Corp. (RTX) , S&P Dow Jones said. S&P Dow Jones said the changes were “prompted” by Apple Inc.’s (AAPL) decision for a 4-for-1 stock split, which will reduce the index’s tech-sector weighting.
https://www.marketwatch.com/story/exxon-out-salesforce-amgen-honeywell-added-to-dow-because-of-apple-stock-split-2020-08-24?mod=home-page
Apple Inc. specializes in the design, manufacture and marketing of computer hardware and music supports. Net sales break down by family of products and services as follows:
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telephone products (54.7%): iPhone brand;
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computers (9.9%): laptops (MacBook, MacBook Air and MacBook Pro brands) and PCs (iMac, Mac mini, Mac Pro and Xserve);
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peripheral devices (9.4%): screens, storage systems, printers, video camera, memory cards, server, switches, etc.;
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music support (8.2%): music readers iPod and iPad and accessories;
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other (17.8%): software, maintenance service and Internet access service, etc.
Net sales are distributed geographically as follows: the United States (39.3%), Americas (5.6%), China (16.8%), Japan (8.3%), Asia/Pacific (6.8%) and Europe (23.2%). Number of employees : 137 000 people.
https://www.marketscreener.com/quote/stock/APPLE-INC-4849/company/
https://www.finviz.com/insidertrading.ashx?oc=1214156&tc=7&b=2