
Could A Change With Fannie, Freddie Be CRE’s Black Swan Event?
A look at how the capital markets are treating commercial real estate.
NEW YORK CITY–Earlier this Spring Kroll Bond Rating Agency assigned preliminary ratings to a CRE collateralized loan obligation that LoanCore Capital Markets was taking to the market. It was backed by an eye-popping $1.1 billion in first mortgages secured by a mix of 33 properties consisting of multifamily, office, mixed-use, industrial, hospitality and retail assets. For the two or so years prior, CRE CLOs had started to come back to the market, but the size of this deal — and to a lesser extent, its 24-month reinvestment period — brought some observers up short. The CRE CLO market, it had suddenly become clear, was back. Now, as it continues to grow it will have ramifications for borrowers and lenders.
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