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

Wednesday, 01 April 2020

Solid Issuance in January, February Pushes 1Q CMBS Deal Volume to $21.55Bln

Thanks to the relatively hefty volume in January and February, CMBS issuance for the first quarter totaled $21.55 billion, up nearly 31 percent from last year's anemic total. Citigroup took top honors among bookrunners, while taking second place in a ranking of loan contributors. JPMorgan Chase Bank took first place in that ranking.

Commercial Real Estate Direct Staff Report

Thanks to the relatively hefty volume in January and February, CMBS issuance for the first quarter totaled $21.55 billion, up nearly 31 percent from last year's anemic total.

January, for instance, had 12 deals totaling $10.6 billion, and February had 14 totaling $7.1 billion. That compares with four deals totaling $2.7 billion and 13 totaling $6.6 billion, respectively, a year ago. Last year's issuance was impacted by expectations in late 2018 of increasing interest rates, which led to a spike in loan spreads, complicating lenders' efforts to lend. CMBS lenders profit by selling loans at a tighter spread than when they originate them.

This year, the coronavirus pandemic, which resulted in widespread business closures starting in the second week of March, effectively shuttered the CMBS market early last month. As a result of social distancing rules and the closing of county offices, where mortgages and deeds are recorded, it's become nearly impossible to complete transactions.

The last CMBS deal priced on March 12. By then, bond spreads already were widening sharply and a week later hit levels not seen since the Great Financial Crisis. They've since retreated somewhat, particularly more highly rated classes, as a massive stimulus bill was signed into law. The bill relaunched the Term Asset-Backed Security Facility, or TALF, which provides a mechanism to effectively backstop certain structured assets. However, it currently excludes CMBS.

Nonetheless, senior AAA bonds were being offered last week at a median spread of 222.5 basis points more than swaps. That's in from the 277.5 bps they were quoted at a week earlier. A month before that, in contrast, they were being quoted at a spread of only 79 bps more than swaps.

Top Bookrunners

Domestic, Private-Label CMBS

 

1Q2020

1Q2019

Investment Bank

#Deals

Bal

$mln

Mkt Shr%

#Deals

Bal 

$mln

Mkt Shr%

Citigroup

2.89

3,265.43

15.15

4.14

2,566.22

15.52

JPMorgan Securities

6.02

3,105.72

14.41

2.70

1,932.39

11.69

Goldman Sachs

4.72

2,959.51

13.73

2.50

1,457.71

8.82

Wells Fargo Securities

3.76

2,860.13

13.27

2.00

1,359.85

8.22

Morgan Stanley

1.83

2,479.14

11.50

3.38

2,208.31

13.35

Deutsche Bank

3.22

2,336.35

10.84

1.93

1,401.27

8.47

Barclays Capital

1.93

1,302.74

6.04

2.01

972.65

5.88

BofA Securities

1.72

1,239.92

5.75

2.73

1,459.02

8.82

Credit Suisse

2.00

1,078.93

5.01

2.42

1,555.81

9.41

Societe General

1.27

437.53

2.03

1.18

335.94

2.03

Cantor Fitzgerald

0.64

237.44

1.10

1.16

287.42

1.74

Natixis

0.50

126.25

0.59

1.00

199.00

1.20

KeyCorp

0.50

122.00

0.57

0.75

110.50

0.67

UBS

0.00

0.00

0.00

1.10

690.35

4.17

 

31.00

21,551.11

 

29.00

16,536.44

 

Citigroup, which contributed $3.2 billion of loans, or 15 percent of the quarter's securitized loan volume, took top honors in a ranking of bookrunners. It received credit for 2.89 deals totaling $3.27 billion, or 15.2 percent of the quarter's issuance. It actually was bookrunner on a total of seven deals, but the ranking divvies up credit based on shares spelled out in offering memoranda and prospectuses.

A ranking that gives every deal manager full credit had Academy Securities on top with 10 transactions totaling $10 billion, meaning it played a role in 46.5 percent of the quarter's volume. Drexel Hamilton, which like Academy, is owned and run by disabled military veterans, was manager of nine deals totaling $9 billion, for a 41.6 percent market share.

Bancroft Capital is another veteran-owned investment bank. It participated in three transactions totaling $3.1 billion, for a 10.2 percent share.

Top CMBS Managers

 

1Q2020

1Q2019

Investment Bank

#Deals

Bal

$mln

Mkt

Shr%

#Deals

Bal

$mln

Mkt

Shr%

Academy Securities

10

10,018.75

46.49

9

7,114.82

36.67

Drexel Hamilton

9

8,962.05

41.59

9

6,524.11

33.63

Citigroup

7

8,866.72

41.14

11

6,797.06

35.03

Goldman Sachs

9

8,275.94

38.40

4

2,137.94

11.02

Wells Fargo Securities

7

8,233.05

38.20

4

2,918.60

15.04

Morgan Stanley

4

7,064.87

32.78

7

5,036.41

25.96

Deutsche Bank

8

6,428.82

29.83

8

5,600.61

28.87

JPMorgan Securities

9

5,078.18

23.56

9

5,984.31

30.85

BofA Securities

3

3,063.37

14.21

8

4,865.67

25.08

Barclays Capital

4

2,713.94

12.59

6

3,352.43

17.28

Bancroft Capital

3

2,197.11

10.19

1

402.80

2.08

Credit Suisse

3

1,238.93

5.75

5

2,450.75

12.63

Cantor Fitzgerald

2

1,074.50

4.99

3

1,307.27

6.74

Natixis

1

252.50

1.17

1

199.00

1.03

KeyCorp

1

244.00

1.13

2

262.00

1.35

Williams Capital

0

0.00

0.00

4

3,632.49

18.72

UBS

0

0.00

0.00

2

1,072.67

5.53

Jefferies

0

0.00

0.00

1

774.09

3.99

Brean Capital

0

0.00

0.00

1

682.67

3.52

Performance Trust

0

0.00

0.00

1

399.20

2.06

JPMorgan Chase Bank, the quarter's top loan contributor with $3.7 billion of volume, was well behind Citi in the bookrunner ranking with 6.02 deals totaling $3.1 billion, or 14.4 percent of issuance.

Top CMBS Loan Contributors

 

1Q2020

1Q2019

Lender

#Loans

Bal

$mln

Avg bal

$mln

Mkt

Shr%

#Loans

Bal

$mln

Mkt

Shr%

JPMorgan Chase Bank

36.59

3,726.07

101.85

17.29

34.86

1,153.12

6.97

Citibank

67.33

3,234.81

48.04

15.01

50.30

2,409.66

14.57

Goldman Sachs

41.72

2,714.96

65.08

12.60

31.74

1,476.18

8.93

Wells Fargo Bank

44.95

2,301.32

51.20

10.68

61.60

985.59

5.96

Morgan Stanley

60.70

2,147.39

35.38

9.96

51.70

1,718.18

10.39

Deutsche Bank

45.52

1,624.87

35.70

7.54

30.40

1,280.23

7.74

Bank of America

43.00

1,182.96

27.51

5.49

36.01

1,434.01

8.67

Barclays Bank

26.20

972.63

37.12

4.51

10.85

972.34

5.88

Credit Suisse

14.00

572.94

40.92

2.66

9.60

1,165.77

7.05

3650 REIT

17.00

505.99

29.76

2.35

19.00

332.73

2.01

Societe Generale

11.00

406.94

36.99

1.89

7.00

336.16

2.03

Sabal

59.00

400.10

6.78

1.86

0.00

0.00

0.00

Starwood Mortgage Finance

28.00

335.84

11.99

1.56

15.00

179.41

1.08

Natixis

2.00

252.50

126.25

1.17

1.00

199.00

1.20

Argentic Real Estate Finance

14.00

242.43

17.32

1.12

9.00

183.95

1.11

Cantor Commercial Real Estate

5.50

237.73

43.22

1.10

9.00

287.02

1.74

Rialto Mortgage Finance

17.00

176.61

10.39

0.82

23.00

255.84

1.55

National Cooperative Bank

38.00

162.01

4.26

0.75

12.00

39.31

0.24

Ladder Capital Finance

12.00

133.67

11.14

0.62

24.00

256.38

1.55

KeyBank

0.50

122.00

244.00

0.57

0.75

110.50

0.67

Benefit Street Partners

10.00

97.37

9.74

0.45

8.00

172.08

1.04

LoanCore Capital Markets

0.00

0.00

0.00

0.00

30.00

648.49

3.92

UBS

0.00

0.00

0.00

0.00

29.20

497.91

3.01

ReadyCap

0.00

0.00

0.00

0.00

95.00

399.20

2.41

C-III Commercial Mortgage

0.00

0.00

0.00

0.00

8.00

43.41

0.26

TOTALS

594.00

21,551.13

994.65

 

607.00

16,536.47

 

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





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Data Digest

 

CMBS DELINQUENCY VOLUME

dqdataFP1

 

CMBS SPECIAL SERVICING VOLUME

sschartfp

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

 

cppichart FP

 

 

CMBS 2.0 Spreads

AAAspreads

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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