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March 10, 2017  

CMBS Pioneer Philipp Retiring From Moody's

Tad Philipp, who had an influential role in the development of the commercial MBS market during two stints at Moody’s, is retiring next month.

Philipp, one of the sector’s best-known figures, was head or co-head of the rating agency’s CMBS group for 16 years, starting in 1992. During that time, he helped vet the structure of CMBS transactions and set credit-quality standards. More recently, he has overseen commercial real estate research at the agency. He has also been an active member of the CRE Finance Council and a frequent conference speaker.

“Tad has long been the dean of the rating agencies, speaking on the issues of the day with an authority and thoughtfulness that will cause a great many to miss him,” said veteran investor Brian Furlong, a managing director of New York Life.

Joseph Franzetti — himself a former head of the CMBS groups at S&P and Duff & Phelps and now a senior vice president of capital markets at Berkadia — said: “Tad brought a unique intellectual discipline to the art of credit ratings. When it was easy to have market forces sway your opinion, he honestly and fervently remained consistent. His voice will be missed.”

In an interview this week, Philipp, 63, saluted his current colleagues at Moody’s and noted with pride that many former analysts had moved on to leadership positions in the industry. “Earlier this week we met with a major investor, and three current Moody’s analysts sat across from three former ones,” he said.

Philipp began his career in 1980 as a credit analyst at MetLife. From 1982 to 1986, he was a vice president of Investment Capital Associates of Westport, Conn., and followed that with a stint as a director of acquisitions for Manhattan Equities of New York.

His 23-year tenure at Moody’s started in 1991 as an associate director under Jeff Fastov in the fledgling four-member CMBS group. When Fastov moved on to Goldman Sachs the following year, Philipp took over the group and ran it solely for the next decade. During that time, Moody’s rated the vast majority of CMBS transactions, helping to shape the market’s formation.

“Tad was here at the birth of the industry and has been instrumental in growing it into a viable long-term business,” said managing director Nick Levidy, the current CMBS chief at Moody’s. “He built the CMBS group and was key to its development over the years.”

In 2002, with the CMBS market firmly established and poised for rapid expansion, Jim Duca joined Philipp as co-head of the team. Philipp shifted his focus to surveillance, research and the nascent commercial real estate CDO market, while Duca concentrated on new-issue CMBS ratings. In 2006, Duca became sole head of the CMBS group, and Philipp was named head of commercial real estate CDOs, while continuing to oversee commercial mortgage metrics, indices and other research efforts.

Philipp left Moody’s in March 2008, when CMBS and CDO issuance was on the brink of what would turn into a two-year pause because of the credit crisis. He joined a unit of CWCapital later that year as a managing director and was promoted to chief risk officer of the company in early 2009.

Philipp rejoined Moody’s in 2011 as director of commercial real estate research in Levidy’s new-issue ratings group. He has headed a three-member team that publishes quarterly and stand-alone research reports and has participated in credit committees that oversee ratings on new and outstanding CMBS. Moody’s doesn’t plan on replacing him. Following his April 20 departure, the two other staffers on Philipp’s research team — vice president Kevin Fagan and analyst Keith Leung — will continue to produce research publications, reporting to Levidy.

In retirement, Philipp plans to pursue his longtime interests in travel and photography. He also recently stepped up his involvement in a nonprofit that operates a miniature golf course on Governor’s Island in New York that is redesigned by artists each year and then rebuilt by volunteers. The effort is organized by the Figment Project, which fosters the display of participatory and interactive art around the country.