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Thursday, 18 January 2018

Year's First CMBS Conduit Launches at Record-Low Spreads

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Commercial Real Estate Direct Staff Report

The year's first CMBS conduit deal has been launched.

The transaction, Benchmark Mortgage Trust, 2018-B1, which is being issued under a Deutsche Bank shelf, includes loans contributed by Deutsche, JPMorgan Chase Bank and Citibank. The $1.17 billion deal marks the first time the three have partnered on a conduit transaction.

Deutsche long had teamed separately with Citi and JPMorgan, but the three never had participated together on a conduit transaction.

Meanwhile, the deal's issuers have provided price guidance of 69 basis point more than swaps for the benchmark class, with the highest possible ratings and a 10-year average life, and 90 bps more than swaps for its junior-AAA class.

If achieved, they would be the tightest spread levels for a CMBS 2.0 transaction, and would best the previous low-spread transaction, Citigroup Commercial Mortgage Trust, 2014-GC23, by 2 bps. That deal priced in July 2014, when the 10-year Treasury was yielding 2.5 percent. Today, the Treasury yields 2.62 percent. They also would compare with a spread of 87 bps more than swaps for the last conduit deal that priced.

The latest transaction has a hybrid risk-retention structure, with Deutsche keeping a 3.47 percent vertical strip and Eightfold Real Estate Capital buying $54.9 million of bonds, or 4.7 percent of the deal, by par value, at a price that would yield 19.77 percent. Eightfold, a Miami investment manager, is buying the bonds through its Eightfold Real Estate Capital...


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Additional Info

  • Syndicate to Realpoint: No
  • Subject: Commercial MBS (CMBS)
  • Private: Yes
Read 566 times Last modified on Friday, 19 January 2018

Data Digest







Top Bookrunners Domestic, Private-Label CMBS - 2017
Investment Bank #Deals Vol$mln MktShr%
Goldman Sachs 17.59 11,819.34 13.68
JPMorgan Securities 14.52 10,968.11 12.70
Citigroup 12.04 10,012.71 11.59
Wells Fargo Securities 14.02 9,936.06 11.50
Deutsche Bank 12.55 9,879.74 11.44




cppichart FP



CMBS 2.0 Spreads


Top CMBS Loan Contributors - 2017
Lender #Loans Vol$mln MktShr%
Goldman Sachs 146.89 11,719.34 13.63
JPMorgan Chase Bank 117.68 10,114.14 11.76
Deutsche Bank 198.48 9,689.97 11.27
Morgan Stanley 166.18 8,539.78 9.93
Citigroup 199.05 8,088.24 9.41





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