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Monday, 11 September 2017

$4.7Bln of CMBS Deals on Launching Pad

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Commercial Real Estate Direct Staff Report

The CMBS floodgates have opened, with the launch of six deals totaling $4.7 billion.

They would bring the year's private-label issuance volume to just more than $57 billion, which is about $11 billion shy of last year's total volume. Given that perhaps another dozen deals are in the pipeline, total volume for the year should easily exceed last year's total.

The ball got rolling last Friday when a single-borrower deal, Stonemont Portfolio Trust, 2017-STONE, priced. The $800 million deal saw its most senior class, rated by Fitch and S&P, price at a spread of 85 basis points more than Libor. The transaction is backed by a two-year loan, written by JPMorgan Chase Bank, Deutsche Bank and Barclays, against a portfolio of 95 office, industrial and retail properties with 6.8 million square feet owned by Stonemont Financial Group. The Atlanta investment manager had purchased the net-leased properties from Oak Street Real Estate Capital for $1.3 billion.

The CMBS loan is senior to $274.1 million of mezzanine debt.

Up next are three single-borrower deals, with the largest a $1.1 billion transaction by Deutsche Bank backed by a piece of the financing against 280 Park Ave., a 1.25 million-sf office property in midtown Manhattan. A venture of SL Green Realty Corp. and Vornado Realty Trust owns the property.

Also in the market are three conduit deals, each of roughly $1 billion. Among them is COMM, 2017-COR2, a $916.5 million transaction backed by loans contributed by Jefferies LoanCore, Deutsche Bank and Citibank. The deal is structured with a horizontal risk-retention piece, totaling roughly 10.5 percent of the deal's face value. Jefferies LoanCore will keep that piece.

That would mark the first time an issuer has retained a horizontal slice of a conduit deal. Issuers have retained vertical slices of conduit deals and have preferred selling off horizontal slices. It's also the first B-piece investment for Jefferies LoanCore, a venture between Jefferies Group and LoanCore Capital, which is backed by GIC Pte. Ltd., Singapore's sovereign wealth fund.

The Greenwich, Conn., lender is contributing 53.1 percent of the deal's collateral pool, which includes a $71 million mortgage against 101 Ludlow, a 361-bed student-housing property in lower Manhattan that's fully leased to the School of Visual Arts.

Of the 32 conduits, with a total balance of $30.1 billion that either have priced or have launched so far this year, 11, with a balance of $9.9 billion, or 33 percent of the total, had vertical risk structures. Another 11, with a balance of $10.5 billion, or 35 percent, had horizontal structures. And the remaining 10, with a balance of $9.7 billion, or 32 percent, had hybrid, or L-type, structures, where a vertical and horizontal strip were retained.

Comments? E-mail Orest Mandzy, or call him at (267) 247-0112, Ext. 211.



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Additional Info

  • Syndicate to Realpoint: No
  • Subject: Commercial MBS (CMBS)
  • Private: No
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Data Digest

 

CMBS DELINQUENCY VOLUME

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CMBS SPECIAL SERVICING VOLUME

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Top Bookrunners Domestic, Private-Label CMBS - 2016
Investment Bank #Deals Vol$mln MktShr%
JPMorgan Securities 14.94 10,350.16 15.14
Deutsche Bank 14.21 9,926.60 14.52
Wells Fargo Securities 13.36 9,513.96 13.92
Citigroup 10.87 8,061.79 11.80
Goldman Sachs 10.05 7,563.72 11.07

 

RCA CPPI

 

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CMBS 2.0 Spreads

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Top CMBS Loan Contributors - 2016
Lender #Loans Vol$mln MktShr%
JPMorgan Chase Bank 133.67 8,670.33 13.34
Goldman Sachs 156.20 7,418.37 11.41
Deutsche Bank 178.17 6,510.75 10.02
Citigroup 184.41 5,512.20 8.48
Morgan Stanley 113.18 4,130.53 6.35

 

 

 

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