Capmark Financial, one of America's biggest commercial property lenders, filed for Chapter 11 bankruptcy protection on Sunday night after being hit by souring loans.

Mohsin Meghji, Capmark's chief restructuring officer, said that the company was already in negotiations with its biggest creditors and hoped to reach an agreement to restructure its debt in the coming months.

Capmark's failure underlines concerns at the Federal Reserve and the US Treasury about the danger the commercial property market poses to America's economic recovery.

Bad commercial property debts have been a significant factor in the demise of many of the 106 small banks that have failed so this year.

Capmark's bankruptcy filing in Delaware said that the company had more than $500 million (£306 million) to keep running while it restructured.

According to Moody's Investor Services, Capmark has originated more than $10 billion worth of commercial property loans.

Jay Levine, Capmark's president and chief executive of Capmark, said: "We view this reorganisation process as an unfortunate but necessary response to recent unprecedented conditions in financial and commercial real estate markets. By constraining the availability of capital, these difficult market conditions had a negative effect on all our core businesses."

The company reported a $1.6 billion loss for the second quarter and has been offloading assets including its North American servicing and mortgage-banking operations, which it agreed to sell for $490 million to a new company part-owned by Warren Buffett's Berkshire Hathaway.

Capmark was the commercial real estate loan business of GMAC, General Motors' finance operation, before being bought in 2006 by a consortium led by KKR, Goldman Sachs Capital Partners and Five Mile Capital Partners. At March 31, the private equity consortium owned about 75 per cent of Capmark, with the rest held by GMAC and its workers.

KKR has already written down the value of its investment in Capmark to zero, The Wall Street Journal reported.

US banks hold more than $1 trillion worth of mortgages backed by commercial property, on which Deutsche Bank analysts calculate the banks could lose as much as $150 billion as property owners default over the lifetime of the loans.

A similar level of losses are expected to be made on $700 billion worth of commercial mortgage-backed securities owned by the banks and other investors such as hedge and pension funds.

Many banks have so far held off writing down their commercial property investments in the hope that the economy will make a quick recovery, enabling borrowers to increase rents and restructure the loans.

The Government is thought to be concerned that a slow recovery may force the banks to make widespread writedowns on commercial property, sending Wall Street into another downwards spiral.

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