Maguire Properties: Impact on CMBS

Maguire Properties announced today that it will dispose of some of its assets. According to the press release, the firm will "dispose of four former EOP/Blackstone assets" and will "no longer continue to fund the cash shortfall associated with (..) mortgages" on several other assets.

Maguire Properties also "entered into loan modifications to amend the financial covenants of (their) Plaza Las Fuentes mortgage and Lantana Media Campus construction loan effective as of June 30, 2009."

Surprisingly, the issues at Maguire may not have a significant impact on CMBSs. According to Bloomberg (page TLKU), Maguire is a tenant in just a handful of loans securitized in CMBSs:

• GSMS 2005-GG4, where Maguire owns part of the Lantana Campus mentioned in the press release. But Lantana Campus is only 2.54% of the CMBS.
• GSMS 2006-GG6 and CGCMT 2005-C3, backed among other assets by a property at 1733 OCEAN AVENUE. This property is only 0.88% and 0.32% of the two deals, respectively.
• MSC 2007-IQ14, whose underlying loans include Corte Madera Plaza owned by Maguire, accounting for 0.24% of the collateral.
• GSMS 2007-EOP, whose loans include Austin Research Park I & II, an asset representing 0.01% of the CMBS collateral.
  

From the press release and from these numbers, it thus looks like only the first CMBS could suffer a 2.54% "event," assuming the entire loan on Lantana Campus is Maguire's -- Bloomberg only reports that 27% of the property is "occupied" by Maguire. The last CMBS may be impacted, according to the press release, but even in the case of a default that asset is only 1bp of the Goldman Sachs structure.