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Monday, 02 April 2018

Busy March Pushes 1Q CMBS Issuance to $19.4Bln

The $9.3 billion of issuance in March pushed the first quarter's volume of private-label CMBS issuance to $19.4 billion, a 55 percent increase from the same period a year earlier. Volume a year ago was hampered by newly imposed risk-retention rules. JPMorgan Chase Securities was the top bookrunner, with a nearly 18 percent share of the market.

Commercial Real Estate Direct Staff Report

Thanks to a relatively busy March, a total of $19.4 billion of private-label CMBS was issued during the first quarter.

That was up nearly 55 percent from the same period last year, thanks to the then-newly implemented risk-retention rules. In fact, last year's first quarter was the slowest first quarter since 2012. Since then, an average of $20.9 billion of CMBS had priced every first quarter.

March's $9.3 billion of volume amounted to nearly half of the first quarter's entire volume, which so far has been evenly mixed between conduit and single-borrower transactions, with $9.6 billion of each pricing.

But in terms of numbers of deals, 21 were single-borrower transactions and nine were conduits. Some of those single-borrower deals were tiny - the smallest was a $94.5 million transaction backed by a piece of a $360 million mortgage that Natixis wrote against One State Street Plaza, an 891,573-square-foot office building in lower Manhattan owned by the Wolfson family trust.

Domestic, Private-Label CMBS Issuance

1Q2018

1Q2017

Deal Type

#Deals

Vol $mln

#Deals

Vol $mln

% Change

Conduit

9

9,621.11

9

8,656.48

11.1

Single-borrower

21

9,615.05

5

2,928.60

228.3

Other

1

164.96

2

967.27

(83.0)

TOTAL

31

19,401.12

16

12,552.35

54.6

That deal was one of six single-borrower transactions, which collectively totaled $993 million, that Natixis led during the quarter. It didn't, however, participate in any conduit deals during the period. But it's contributing 24 loans totaling $393.2 million to an upcoming deal led by Credit Suisse, which should price soon.

Whether the onslaught of single-borrower deals continues remains to be seen. On their surface, some of the deals issued during the quarter were only marginally profitable - perhaps victims of timing.

JPMorgan was the top bookrunner for the quarter, receiving credit for 5.4 deals totaling $3.4 billion, or nearly 18 percent of issuance. It was followed by Deutsche Bank, which received credit for 2.5 deals totaling $2.7 billion, and Citi, with 3.3 deals totaling $2.3 billion.

Top Bookrunners
Domestic, Private-Label CMBS

1Q2018

1Q2017

Rank

Investment Bank

#Deals

Bal $mln

Mkt Shr%

#Deals

Bal $mln

Mkt Shr%

1

JPMorgan Securities

5.37

3,432.14

17.7

1.4

1,483.23

12.7

2

Deutsche Bank

2.50

2,741.50

14.1

1.4

1,589.46

13.0

3

Citi

3.33

2,297.85

11.8

2.1

2,194.92

18.0

4

Goldman Sachs

3.33

2,063.43

10.6

2.9

2,311.94

19.0

5

Wells Fargo Securities

2.5

1,504.04

7.8

2.1

1,531.65

12.6

6

UBS

2.25

1,478.24

7.6

0.6

425.02

3.5

7

Barclays Capital

1.81

1,395.00

7.2

1.2

998.70

8.2

8

Morgan Stanley

1.13

1,036.23

5.3

1.5

887.33

7.1

9

Natixis

6.41

992.95

5.1

-

-

-

10

Credit Suisse

1.03

810.00

4.2

2.0

427.10

3.5

11

Societe Generale

0.60

670.79

3.4

0.1

91.17

0.8

12

BofA Merrill Lynch

0.43

514.73

2.7

0.6

611.83

5.0

13

Cantor Fitzgerald

1.29

464.21

2.4

-

-

-

 

TOTAL

32

19,401.12

 

15

12,552.35

 

Source: Commercial Real Estate Direct

A ranking that gives full credit to every lead and co-manager on a deal had Drexel Hamilton once again on top, with eight deals totaling $8.2 billion, meaning it was a co-manager on just more than 42 percent of the quarter's volume. The institution was founded by Chance Mims, a U.S. Naval Academy alumnus who served on the USS John Paul Jones during Operation Enduring Freedom.

Behind it in that ranking were Deutsche Bank and JPMorgan, both of which were involved in just more than 40 percent of the quarter's issuance.

Top Managers
Domestic, Private-Label CMBS

1Q2018

1Q2017

 

#Deals

Bal $mln

Mkt
Shr%

Bal $mln

Mkt
Shr%

Drexel Hamilton

8

8,159.13

42.05

6,528.26

52.01

Deutsche Bank

8

7,915.89

40.80

3,345.92

26.66

JPMorgan Securities

10

7,781.89

40.11

2,136.43

17.02

Citi

8

6,987.37

36.02

4,766.48

37.97

Academy Securities

7

6,974.06

35.95

5,326.59

42.44

Wells Fargo Securities

5

4,037.60

20.81

3,008.33

23.97

Goldman Sachs

5

3,528.13

18.19

3,406.94

27.14

Barclays Capital

4

3,503.62

18.06

2,468.31

19.66

Morgan Stanley

3

2,749.53

14.17

2,317.09

15.55

BofA Merrill Lynch

2

2,349.53

12.11

1,997.09

15.91

Credit Suisse

7

2,342.94

12.08

427.10

3.40

UBS

3

2,185.07

11.26

1,493.31

11.90

Cantor Fitzgerald

3

2,080.07

10.72

-

-

CIBC

1

1,045.17

5.39

-

-

Natixis

6

992.95

5.12

1,025.32

8.17

Source: Commercial Real Estate Direct

Comments? E-mail Orest Mandzy, or call him at (267) 327-4281.


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