Daily market intelligence on mortgages, equity raising, investment sales, and CMBS.

Wednesday, 31 October 2018

Seller of Phoenix' Chase Tower Bought Loan via Fair-Value Purchase Option

Taconic Capital Advisors, which led the team that recently sold the 723,922-square-foot Chase Tower in Phoenix for $107.5 million, had purchased the distressed loan against the property in April for $62.15 million by exercising a fair-value option. At the time, the collateral property carried an $82.4 million appraisal.

Commercial Real Estate Direct Staff Report

Taconic Capital Advisors, which led the team that recently sold the 723,922-square-foot Chase Tower in Phoenix for $107.5 million, had purchased the distressed loan against the property in April for $62.15 million by exercising a fair-value option.

That has investors in the CMBS deal that held the debt against the 40-story building seething.

It's not so much that Taconic exercised its fair-value option. After all, the New York investment manager often invests in the controlling classes of CMBS deals, particularly legacy transactions, in part because those investments generally give it the option to buy defaulted loans from collateral pools at fair value. Rather, they're furious because the option price was substantially below the $82.4 million value for the collateral property set by a May 2017 appraisal.

Chase Tower was one of two properties that secured what originally was a $198.5 million loan that was securitized through GE Commercial Mortgage Corp., 2007-C1. The other building is 1111 Fannin, with 428,629 sf in Houston. Both are leased in their entirety to JPMorgan Chase under an agreement that runs through March 2021.

They were owned by Brookfield Asset Management, which assumed them through its 2010 acquisition of Crystal River Capital Inc. That company had acquired them in 2007 for $234 million.

The $198.5 million loan had transferred to special servicer C-III Asset Management in April 2017 when it matured without being retired. The two buildings are fully leased to JPMorgan Chase Bank. But the leases mature in March 2021. That made it impossible to refinance the loan.

Taconic holds certain subordinate bonds in the GECMC 2007-C1 transaction, giving it the...





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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 - 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

 

RCA CPPI

 

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CMBS 2.0 Spreads

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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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