CMBS Jobs market
Hello,
Whats happening with the CMBS job market. Seems like jobs are posted but does not seem to be moving along. Any thoughts. I am currently in the market looking for underwriting opportunities, can seem to be getting any traction.
Appreciate any feedback.
Thank you
Because of recent turbulence in the bond market, CMBS has pretty much shut down. With this turbulence, lenders do not know how to price CMBS, and lenders are starting to tighten deals (or put pencils down) - literally in the past few weeks.
It would make sense that hiring is put on hold given the volatility in the market.
^Yep. If anything, I would expect some layoffs in CMBS, particularly at the smaller shops that table fund or don't have a substantial balance sheet to dedicate to CMBS. Risk retention regulation (misguided though it may be) going into effect at the end of the year will also help to shake out some of the smaller players on top of the market volatility.
Example: http://www.asreport.com/news/redwood-stops-cmbs-lending-will-others-fol…
CMBS markets have been bad since Summer 2015. And there have been frequent shuttering of smaller firms/downsizing at bigger firms.
Plus side, since last week, I've seen the market improving (i.e. spreads tightening in CMBX) so sit tight until then
While there is a lot of market volatility, all shops still need underwriters. I would not recommend looking for a CMBS job right now, but if you had to, look at SITUS or Spring11, the outsourcing companies.
who do you think they underwrite for?
-said CMBS shops
There are a lot of CMBS deals that are getting done that require underwriting. It's just with the excessive competition and market volatility that many of these deals are not profitable.
SITUS and Spring11 are humming. I don't think I have heard any layoffs there.
The outsourced firms underwrite for all the big boys. However, the underwriting at SITUS is used as a check and they probably won't use your numbers verbatim.
A job is a job though and it's a great way to get exposed to tremendous deal flow of all different asset types.
CMBS origination market is broken and will be for awhile until the risk retention piece is sorted out. I've heard estimates that 2016 CMBS volume will be half of what it was last year ($60B vs. 120B). There is legislation in Congress right now that would help ameliorate some of the more onerous parts of the recently enacted regulations but don't expect any serious action until maybe next year (depending on who wins the election). Also, B piece buyers are scrutinizing deals much harder and kicking a lot of deals of pools. Some of the investment banks are getting back into balance sheet lending as a result but there will still be a big vacuum in the market that will likely be filled by private capital. Back to OP's question, I would look for opportunities in shops that have balance sheet and agency origination platforms in addition to CMBS.
As somebody working for a large CMBS lender, pretty much agree with what everyone as said. The outsourcing companies are always an option, but at times even riskier (knew somebody analyst/associate level who was canned just 2 months after joining very recently). On site consultants might be cheaper but are also easier to get rid of.
Feel free to pm me if you have any questions.
It will get worse before it gets better. Most of the layoffs haven't even happened yet. Right-sizing is a gradual process. I would jump ship to a balance sheet lender as soon as you can. Portfolio lending is doing great right now, there's plenty of opportunities.
For many reasons including a new company direction as a whole, GE Capital has totally shut down their CMBS/Capital Markets division. This was a few months back.
I agree with everything here so far. Factors such as risk retention requirements, credit spreads widening leading to higher interest rates for borrowers and general market freeze up is making working and looking for cmbs uw jobs really difficult. Was also wondering why I wasn't hearing back from UW positions I applied to.
Deal flow at my shop really dried up Jan/Feb with only really crappy, story loans seeking refinancing, which we quickly rejected. Might be some time until the gridlock opens up but balance sheet lending jobs, Asset Management, and portfolio management jobs are really the only ones I see hiring these days.
Recently read that CMBS finances only 25% of the nations CRE. Life cos. and banks are the way to go if your looking for an uw job. or multi-lending platforms that offer agency. Also noticing many bridge lenders/floating rate programs starting to gain traction out there.
I would also note that a lot of non-bank lenders are getting out of the space, as a lot of warehouse lines are being cut
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