The current model for CMBS financing is hopelessly outmoded, largely because when it was created in the 1990s, and nobody could anticipate how much securitized financing would expand over the next 15 years, said Ethan Penner, president of CBRE Capital Partners. He is widely described as the inventor of today's CMBS financing. Over the years, CMBS underwriting became complacent as the people who put together the deals put excessive reliance upon the rating agencies, he said.

Related Summaries