Elsewhere in franchise, BNY Asset Solutions, a subsidiary of the Bank of New York, continues its drive into the sector as a franchise loan servicer, most recently taking on the role of master servicer for Peachtree Franchise Loan 1999-A, a $135 million portfolio originated and securitized by Peachtree Franchise Finance.
In August, BNY was named servicer on the performing loans of two Franchise Mortgage Acceptance Co. deals wrapped by MBIA. Altogether, the company is currently servicing approximately 14,000 franchise loans worth about $1.2 billion.
"BNY is particularly attractive in the franchise arena because of the bank's support and advancing capability," said Cheryl Eskridge, director of commercial real estate and business loan servicing. "Also, we have a group highly trained in special servicing."
Interestingly, two days after the announcement that BNY had been named master servicer on the Peachtree deals, Moody's Investors Service took action on the same trust. The timing, however, was incidental, as BNY has been on the portfolio for several months prior to announcing it, and the downgrade was not associated with the servicing.
BNY made its start in the franchise arena when it took over the servicing of several portfolios securitized by Captec Financial Group, worth approximately $500 million.
BNY also services Falcon Financial's securitized portfolio from new issue forward, and is servicing loans for the dealership lender that are currently warehoused, pre-securitization.
As for the outlook on the industry, Eskridge comments, "What we see, as far as the distressed loans go, particularly in the quick service industry, is that it seems right now to be stabilizing a little bit, but to see actual improvement, it could be 12 to 18 months."
The company is not specifically rated as a franchise servicer, though it has spoken with both Fitch Ratings and Standard & Poor's about the prospect. BNY is rated as a servicer of commercial mortgage loans, and was downgraded by Fitch in July for high employee turnover in that division.