Commercial Real Estate Direct Staff Report

The Federal Reserve Bank of New York accepted 55 of the 58 CMBS submitted on the Dec. 14 subscription date for financing under the Term Asset-Backed Securities Loan Facility, or TALF, for legacy CMBS.

In total, the Fed received requests for $1.3 billion of financing. One of the bonds offered up as collateral included in its pool a $1.5 billion piece of the debt on the troubled Stuyvesant Town/Peter Cooper Village apartment complex in Manhattan. That bond was rejected by the Fed.

The three bonds that were rejected were the:

- A5 class of LB-UBS Commercial Mortgage Trust 2005-C2, which has a 2.07 percent delinquency rate and 4.26 percent concentration of loans in special servicing. The bond class has a 22.7 percent subordination level, up from 20 percent at issuance.

- A3 class of Wachovia Bank Commercial Mortgage Trust, 2007-C30, which has a 2.32 percent delinquency rate and 21.61 percent concentration of loans in special servicing. It includes a piece of the financing on the StuyTown property, which is now widely thought to be worth only about $2 billion. The subordination level of the bond classes is up slightly since issuance, to 30.06 percent from 30 percent.

- APB class of Wachovia Bank Commercial Mortgage Trust, Series 2007-C33, which has a 3.5 percent delinquency rate and 4.15 percent concentration of loans in special servicing. The bond class is what Wachovia at the time called a "planned balance" class, in that after mortgage cash flows are applied to the deal's bond classes in their usual sequential order, what remains is first applied to the planned balance class, then to the remaining triple-A bonds.

Under the TALF program, investors were able to request three- or five-year loans with rates pegged to Libor plus 100 basis points. That equates to 2.7435 percent for the three-year loans and 3.6241 percent for the five-year loans.

Comments? E-mail Orest Mandzy or call him at (215) 504-2860, Ext. 211.