Commentaries
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We don’t need your stinking financing
The New York Fed reports that investors only requested financing for $72.2 million of new CMBS loans through its TALF program. Since there’s only been one, the $400 million offering from Developers Diversified, it raises an interesting question: would investors prefer to go it alone without perceived government strings attached rather than juice returns through leverage?
Though I’m still skeptical about what this means for the billions of loans that still need to be refinanced, this is a good sign for the CMBS market and one that issuers are sure to notice. Demand is out there whether there’s nonrecourse loans or not.
The drought is (kind of) over!
After months of buildup, Developers Diversified Realty Corp finally sells the first commercial real estate bond in more than a year. At $400 million, it’s hardly a dramatic debut, but it’s a significant first for one of the few markets still jammed since the financial crisis.
From Reuters:
Met with strong investor interest, Developers Diversified was able to price the deal below existing levels for the CMBS issues. Its $323 million AAA-rated five-year notes came at a narrower 1.4 percentage point premium to the five-year interest rate swap benchmark, or a yield of 3.807 percent, market sources said.
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The Wall
