While questions about the rights of CMBS investors in bankruptcy cases and other risks persist, there are offsetting trends that continue to drive the securitized commercial mortgage market toward a comeback, according to Mark Edelstein, chairman of Morrison & Foerster's real estate finance group.

Edelstein — who said his firm has represented various parties in high-profile bankruptcy cases such as General Growth Properties — cautioned CMBS investors to keep in mind that a judge "might not respect the structure and/or some of the protective features that you thought you were buying into." Edelstein, whose CMBS litigation experience also has included work with Extended Stay Hotels, said there arose in that case and others "fundamental questions never answered" by the courts or addressed in deal structures regarding whether going forward courts will "recognize CMBS structures at all."

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