Last Updated: March 24, 2010 12:40pm ET

3 comments

Another win for CMBS - and REITs

By Erika Morphy
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Another sign has emerged that the CMBS market is starting to come back. REIT Ramco-Gershenson Properties Trust  just closed on a new $31.3 million CMBS loan with J.P. Morgan. It's not the much-longed for multi-borrower conduit type deal, but still. Ramco-Gershenson secured a loan at 60% LTV for two retail properties at a ten-year term at a fixed rate of 6.5%. The deal is also a nod to REITs, the publicly-traded ones, that is, which have become de facto kingmakers in the commercial real estate debt and equity markets. The biggest boost to CMBS, it must be noted, came from another REIT - Developers Diversified Realty - last year with its $400 million CMBS. DDR then disappointed the market by declining to go back for a second pass. Instead, it has recently priced a $300 million  stock offering. That move wasn't so much a commentary on the still-nascent CMBS market, but rather an illustration that REITs basically have all sorts of capital raising avenues open to them these days.

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Comments+ Add your comment

Posted by comment_user_450015

LOL. A $31M loan is worthy of whole column. Now that's funny.

March 30, 2010 at 03:34 AM EDT #
Posted by comment_user_450016

The final sentence of this post is somewhat inaccurate. If you read the press from senior management at DDR it is obvious why they did not make a second pass at CMBS. They claim the process was laborious and painful and barely worth the effort. Any avenue to deleveraging EXCEPT CMBS was preferable in their minds.

March 29, 2010 at 04:03 PM EDT #
Posted by comment_user_450017

re: the article titled "Another Win for CMBS" demonstrates that the author did not do his research... When discussing the return of CMBS financing he mentioned to relatively small transactions. However, he failed to mention the Blockbuster CMBS loan by Inland in the amount of $625,000,000 on 12/1/2009, utilizing J.P. Morgan. Inland was the first CMBS transaction in 18 months and other Inland Companies have followed suit. Between December 1st, 2009 and April 30th, 2010 Inland Companies will have closed on aproximately One Billion Dollars in CMBS loans. It's hard to talk about the CMBS Market without mentioning the Inland Real Estate Companies.

March 26, 2010 at 03:13 AM EDT #

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