Low oil price hits Dakota property debt
Seattle
THE plunge in oil prices may jeopardise almost US$125 million of securitised loans backed by real estate in North Dakota, as drillers in the state scale back operations, Morningstar Credit Ratings LLC said.
The rating company said that the debt, which has been put on its watch list in the past 24 months, represents more than a third of almost US$340 million of commercial mortgage-backed securities tied to the shale hubs of North Dakota. The loans, created in 2013 and 2014, "have run into trouble as the slump in oil prices weighs on demand for commercial real estate in the oil and gas patch hubs of North Dakota", Morningstar said in a report issued last Wednesday.
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