Ladder CRE CLO prices in line; MSBAM hits market; Hyatt deal and supply surge awaited — CMBS Primary Market Wrap - Debtwire

Ladder CRE CLO prices in line; MSBAM hits market; Hyatt deal and supply surge awaited — CMBS Primary Market Wrap

03 October 2017 - 12:00 am

The USD 39.9m BBB- rated Ds of Ladder Capital’s debut CRE CLO, LCCM 2017-FL1, priced today at L+ 360bps, in line with where the BBB rated Ds of the PFP 2017-4 CRE CLO priced last month, according to two syndicate sources.


The USD 456m deal’s USD 244.4m AAA rated As priced at L+ 88bps, also in line with where the PFP deal priced on 18 September. Wells was the deal’s sole structuring agent.


The inaugural Ladder CRE CLO is collateralized initially by 19 mortgage loans and has a weighted average unweighted NCF DSCR of 1.24x, a weighted average loan term of 23 remaining months and a weighted average mortgage asset gross margin of 4.964%, according to the sources.


The top property types are office (32.5%), multifamily (22.2%), and retail (14.3%). The top states are California, New Jersey, Illinois, Ohio and Arizona.


In August, Ladder Capital Corp. executives said that they had mixed feelings about the execution of the company’s USD 625.7m LCCM 2017-LC26, the debut Ladder-only, multi-borrower CMBS, as reported (see story, 3 August).


The deal’s USD 31.4m in A-/A (Fitch/KBRA) rated C bonds priced at S+ 250bps on 22 June, in line with guidance but 60bps wide of where comparable bonds from the USD 811m CSAIL 2017-C8 priced the previous day, as reported. The LCCM deal’s USD 167.85m AAA rated A-4s priced at S+ 110bps, 7bps wide of comparable bonds in the CSAIL deal.


Separately, Bank of America and Morgan Stanley are marketing a USD 1.049bn conduit, MSBAM 2017-C34, according to syndicate sources. The deal has a weighted average cutoff LTV of 59.3% and a weighted average UW NOI debt yield of 10.8%. The top property sectors are office (44.6%) and retail (25.2%). The deal is expected to price by the end of next week.


Investors also are awaiting the single-borrower Hyatt 2017-HYT2 offering from Goldman Sachs and JPMorgan, according to an investor. A portion of the bonds may be pre-placed, he said. The floating-rate deal is USD 410m in size, according to Trepp data.


The conduit and the SASB may be among a rush of other new issues hitting the market.


While it’s not too active on the new issue front now, “there should be a lot of supply coming,” the investor said. “We could start seeing it over the next few days.”


by Maura Webber Sadovi and Sarika Gangar