Our Mission

Our mission is to provide standardized underwriting tools and data for all participants in the CMBS industry. Benefits include:

• Faster, easier and more cost effective access to loan, property and bond data.
• Easier, more accurate and more detailed data communication and transfers among all parties — up and down and across the process with an emphasis on standardized underwriting tools (a common calculator).
• Higher investor confidence in CMBS as an asset class. With underwriting tied out to the rent rolls, a transparent standard will help investors make informed decisions — decisions that bring more stable capital back into the CMBS market.

State of the CMBS market

In a word: Transitioning.

In two words: Black Box.

The industry needs standards and transparency — now more than ever. Investors and rating agencies do not have sufficient access to surveillance information to accurately assess risk. We believe the industry needs a holistic solution: one that encompasses the entire origination and surveillance process.

For loan origination, common underwriting tools shared by the borrower, lender, appraisers, rating agencies and investors would offer a huge benefit.

For surveillance, better and more complete data flow between the primary servicer, master servicer, trustee, rating agency and, finally, to the investors would make the value of the underlying securities more transparent (and therefore more liquid).

In the current CMBS model, origination data reaches the lenders in a wide range of formats and levels of completeness. This data must be analyzed, packaged and passed to rating agencies and B-piece buyers, who get clumsy access to available data that must then be re-analyzed.

When the securitization closes, lenders pass limited data to master servicers, and critical issuer underwriting models are lost. Most parties perform proprietary analysis, and Excel models still rule the day. XML is almost never used.

Post closing, data transfer from the master servicer to the investor via the trustees is relatively standardized and clean (IRP version 5), but the data being reported is missing critical data (specifically the lease information found on the rent rolls). While all master servicers collect rent rolls from borrowers, only some are able and willing to report the data in useable formats. The rating agencies and the investors are handicapped in their activities because of incomplete data reporting and insufficient access to Web based tools to interpret the data.

It's time to adopt a common, transparent CMBS platform, with standardized underwriting tools and data shared among all parties.

Backshop’s role

Over the past eight years, Backshop loan origination software has improved productivity and transparency among major commercial real estate lenders. More CMBS lenders use Backshop than any other software (visit www.backshop.com to learn more).

• Used by the rating agencies.
• Powerful credit risk tools at loan and securitization level.
• Total underwriting transparency to the rent roll level by Backshop's lease-by-lease underwriting models.
• Web interface. Backshop is the market's only Web-based lease-by-lease underwriting tool.
• Proven — We have been in business since 2000, and issuers routinely report 100 percent efficiency gains after adoption of Backshop.

While Backshop has helped lenders increase profits, it has also empowered the transfer of data from lenders to rating agencies, master servicers and B-piece buyers. What Backshop has done for these entities, it can help do for the entire CMBS market.

What next?

With the CMBS market in a state of uncertain transition, there has never been a better time to adopt a more transparent, more credible standard.
CMBS.com's President and CEO Jim Flaherty has long supported the CMSA and the MBA / MISMO to help create and implement shared analytical tools and a shared data platform.

As a major (but initial) step toward openness, Flaherty is using this site, CMBS.com, to provide open access to IRP data in an XML format.

Ultimately, we envision an open site that serves as the universal analytical and data platform where all members of the CMBS community can find value.