Commercial Real Estate Finance Council Europe (CREFC Europe) released Version 2.0 of its European Investor Reporting Package (E-IRP 2.0).
The aim of E-IRP 2.0 is to help improve transparency and liquidity in the European commercial real estate (CRE) financial markets.
The new package has also been amended to offer a standard data template for consistency in the transmission of all CRE loan data that is not just for CMBS.
It has also been designed to provide core asset and loan information that can be used as the basis for reporting for various kinds of capital market deals backed by European CRE, such as covered bonds, syndications, subordinate debt structures and CMBS.
The new release's key features include data fields that can be used for different loan structures including securitization, whole loan, syndication and A/B loan positions.
It also has re-defined field definitions that clarify key concepts as well as has an introduction of the minimum required fields, which are key fields that should be populated for basic deal information flow. This version also introduces standards for calculating key financial indicators like interest coverage ratios, debt service coverage ratios and loan to value ratios. It features financial calculations that can be based on the loan agreements and loan structure participation levels.
“CREFC Europe worked with the European Central Bank (ECB) and its advisor, Link Financial, in order to harmonise standards between the respective ECB’s CMBS reporting template and E-IRP version 2.0,” said Matthew Webster, chairman of CREFC-Europe's Board of Governors and HSBC Bank's managing director and global head of real estate finance.
“This harmonization is a key achievement since it should encourage a uniformed approach to data collection within the European CMBS market and, hopefully, the wider commercial real estate finance sector,” Webster added.
In 2004 CREFC Europe started a process of gathering market participants to verify the best way to create a European reporting package. The E-IRP committee thought that it would be best to use CREFC U.S. IRP's general format instead of creating one for Europe and to customize for the U.K./European CMBS markets. This was completed in 2005.
In late 2007, the CREFC Europe E-IRP Committee started the process of updating the reporting package to Version 2.0 and set out to introduce further standards in CMBS reporting. The features added were: how to make the package adaptable to the various transaction types and specific to the loan event calculations as well as ways to encourage the package's broader use among issuers and servicers.