ValueXpress is actively seeking new CMBS conduit loans. We are pursuing multifamily, manufactured housing community (MHC), self-storage, industrial, retail and office loans. Hotels remain on pause unless performance was unaffected by COVID-19. Interest rates are in the 4.00%-4.50% range. We are seeking both permanent loans for stabilized properties and bridge loans for properties in process of stabilization.
The CMBS conduit loan market has been buoyed by recent successful CMBS securities issuance. Securities pricing has improved with each new CMBS deal. Most recently, a group of bookrunners led by Barclays is marketing an $807.8-million offering that includes 49 loans secured by 153 properties, most of which were closed prior to COVID-19. The offering features multifamily, manufactured housing community, self-storage, office, industrial, mixed-use, and retail loans. The benchmark AAA-rated super senior class is expected to price at roughly 115-125 basis points (bp) over swaps. That pricing would be an improvement from the last CMBS offering led by Wells Fargo that priced at 145 bp over swaps.
“This transaction is another step forward in the quick recovery of the CMBS securities market,” commented Michael Sneden, Executive Vice President at ValueXpress. “What’s important is that the Wells deal contains plain-vanilla CMBS conduit loans. The two deals prior had investment-grade loans that were not comparable with the loans that ValueXpress originates.”
As a result of these successful transactions, interest rates on CMBS conduit loans are steadily drifting down. Rates are 4.25%-4.5% for full-leverage transactions and 4.00%-4.25% for low-leverage transactions.