Thursday, March 24, 2011

GSMS 2011-GC3 ($1.4bln)

Goldman priced their $1.4bln deal yesterday

Tr Size(mm) M/D WAL Pricing
A1  $          86.00 Aaa/AAA 2.5  S+80
A2  $        399.00 Aaa/AAA 4.81  S+125
A3  $        128.00 Aaa/AAA 7.18  S+140
A4  $        532.01 Aaa/AAA 9.73  S+125
B  $          59.53 Aa3/AA 9.84 S+185
C  $          54.28 A3/A 9.87 S+235
D  $          59.53 Baa3/BBB 9.94 S+300

Wednesday, March 23, 2011

Villas Parkmerced ($550mm)

This loan is both pooled and serves as collateral in the rake legs on CD 2006-CD2, AND the mezz note was in SPAF 2006-1, a CRE CDO. Barclays noted today in a research note that the MAI appraiser came in at $705mm as the total value (that's good), which could lead to a full paydown. Fortress purportedly took over the Rockpoint/Stellar interest in the property four months ago and apparently paid off the mezz.

They also note the likely alternative to a refi would be a 5 year extension, which would likely require additional equity infusions to fund reserves and some further stabilization of the asset.

Friday, March 18, 2011

JPMCC 2005-LDP4 Silver City Galleria ($138mm) 5.97% of deal

A week ago it was reported that this loan's default would likely wipe out up into the G class of investors ;-(.

This is not unexpected by any stretch of the imagination as this was one of the JV assets GGP did not include in the bankruptcy, but did kick the keys back to the servicer.

Thursday, March 17, 2011

New Issue Calendar

Cantor 2011-1 ($1 Billion)
GSMS 2011-GC3 ($1.4 Billion)
GSMS 2011-ALF ($325mm)
JPMCC 2011-C3 ($1.5 Billion)

There are also several multifamily agency deals:
FHMS K011 ($1.2 Billion)
MFMEG 1 ($315mm)
FREMF 2011-K701 ($1 billion)
and Ginnie Project loan deals, series 31, 33, 38, 42, 47, and 49.

Cantor 2011-1 - $1 billion - LNR to buy the B-Piece?

Bloomberg noted today that LNR might be the B-Piece buyer. See its NBD when you're a BSD.

Friday, March 11, 2011

Winners are getting back into CRE!

Bodamer notes that the rich folk are getting back into the CRE market

And he also notes that Zells says:
  • No new construction for two or three years. Dearth of supply will get filled up and re-occupied.
  • Once oversupply comes back, 'extend and pretend' will get replaced more with 'dilution is the solution' where buildings get recapitalized and owners get hope notes
  • He's got a bunch of other clips on his Retail Traffic blog - you should click through even though he doesn't have cool picture of a cat representing the Winners and the rest of the world. I call my cat Charlie.

Saturday, March 5, 2011

GGP Prepays

In 2009, the market was so idiotic about extension risk that it priced current and next pay bonds with teen yields. The pendulum has swung fully the other direction in that part of the curve. As Citi noted on Friday, 6 GGP properties are very likely to refinance, and every one of the related front-pay bonds is not only pricing above par but also has a negative yield (as bad as -12.57%) if the loans prepay as is expected.

Bond Dollar Price Property 0/0 Full Prepay Yield
COMM 2001-J2A A2  $      102.29 Willowbrook Mall -3.39%
GCCFC 2004-GG1 A5  $      100.51 Deerbrook Mall 0.71%
GSMS 2001-GL3A A2  $      102.30 Northridge Fashion Center -1.88%
LBUBS 2005-C5 A2  $      102.28 Providence Place -5.50%
WBCMT 2004-C14 A2  $      101.46 Park Place Mall -1.69%
WBCMT 2006-C26 A2  $      104.75 The Woodlands Mall -12.40%

They also highlighted the "special consideration properties" that GGP has listed that are in CMBS deals where they intend to throw the keys back. The 2 in red have been transferred back to the lenders (they have stated that they have already thrown back the keys on 3 others).

Deal Loan PCT of Deal
WBCMT 2004-C11 Bay City Mall Bay City 2.8%
LBUBS 2006-C1 Chapel Hills Mall Colorado Springs 5.1%
CD 2005-CD1 Chico Mall Chico 1.0%
MSC 2006-HQ9 Country Hills Plaza Ogden 0.5%
WBCMT 2005-C22 Eagle Ridge Mall Lake Wales 1.9%
GECMC 2005-C4 Grand Traverse Mall Traverse City 3.9%
COMM 2006-C7 Lakeview Square Mall Battle Creek 1.8%
CGCMT 2008-C7 Mall St. Vincent Shreveport 2.8%
CGCMT 2007-C6 Moreno Valley Mall Moreno Valley 1.8%
MLCFC 2006-4 Northgate Mall Chattanooga 1.0%
MSC 2005-HQ6 Oviedo Marketplace Oviedo 2.1%
BSCMS 2006-PW14 Piedmont Mall Danville 1.4%
CSFB 2005-C3 Southland Center Mall Taylor 7.6%

Wheeler was a fine analyst and had big boots to fill, but I have to say that Jeffrey Berenbaum's new team is really doing a good job with this kind of analysis.

666 Fifth Avenue Retail space trades at $8.3k psf

Bloomberg is reporting that Inditex bought the former NBA space (39k sq ft) for $324mm, or $8.3k psf making it the highest retail valuation evah. They're going to put a Zara store there. You'll recall that Uniqlo leased space there approximately 1 year ago at $2k psf (note that in the comments Rational Realist clarified the lease with sources as well).

If you leave 30 Rock and walk through 666 Fifth and come out through the Hickey Freeman entrance, you see the Ermengildo Zegna store in front of you, and this space is on your right at the corner of 52nd and Fifth.

For some price points, the article goes on to note that the 2008 sale of a partial ownership interest in the retail portion of the building (from Kushner to Carlyle and Crown Acquisitions) valued the space at $6,187 psf.

In regards to the CMBS loan, this space was released as collateral related to the aforementioned 2008 transaction with Carlyle and Crowndid not serve as collateral. This space is part of the 95k sq feet of "Fifth Avenue Retail Space", BUT the mezzanine loans must be paid down with any proceeds from a sale of this space. I don't know if they are still outstanding, but I bet they were. BCRE and UBS made the original loans, but I also do not know who the investors were.

The "Other Retail & Storage Space" (69k sq feet) + Office + Parking constitute collateral for the CMBS loan financing original purchase by Kushner and Gellert, which used an $1.215 billion senior note split unevenly between WBCMT 2007-C31, GECMC 2007-C1, and WBCMT 2007-C33, plus $335mm of senior mezz, plus $200mm of junior mezz, for a total financing of $1.75 billion

The irony is not lost on us that precisely 1 year ago, to the day, almost to the hour, we noted that this property was in Special Servicing.

Friday, March 4, 2011

I'm going to set up a Girl Scout Cookie stand at One Park Ave

Looks like One Park Avenue is likely to pay down as early as next month according to stories in CMAlert and a report out from Barclays today. The $375mm loan is in BACM 2007-2 (6.01%) and BACM 2007-3 (5.36%), and Barclays thinks the defeasance (BB shows it as having 9 months of lockout? maybe that is incorrect) will get waived and it will pay off.

In other words, you might not want to buy the BACM 2007-2 A1s offered at 101-01 today (even though they got lowered from 101-02...), and you probably didn't get that great a deal if you bought those BACM 2007-3 A2 last week at 104

According to Barclays, the recap included a $250mm 5year from MS for the next CMBS deal, $180mm equity from Vornado for 95% of the deal, and Murray Hills is retaining the remainder 5%. The total cash involved here is $430mm. This is not a clean trophy property sale, though. The senior mezzanine holder, RXR owned $75.4mm (M1), was pressing hard for action including potential foreclosure. The $50.4mm residual was held by Citi and the $32.6mm M2 was held by BOA for a total debt stack of $483.4mm. BCG expects the M2 will take a substantial hit - my math says the M1 is going to take a pretty good hit too, and once we start adding in fees it may get worse.

I've really just been looking for an excuse to use this picture - those girl scouts are hard core and you don't want to mess with them.

Wednesday, March 2, 2011

14,000 surplus US-owned buildings for sale?

Probably includes some pretty useless stuff, but I'd love to see a list... anyone? anyone?

Market Square sold for $615mm

I know, I know, I'm a little behind, but late is better than never.

The trophy DC office property located on the 700 and 800 blocks of Pennsylvania Avenue was part of the Beacon Seattle Portfolio in WBCMT 2007-C31, WBCMT 2007-C32, BSCMS 2007-PW16, BACM 2007-2, MSC 2007-IQ14, and MSC 2007-HQ12. The $905 psf price implies an approximate cap rate of 4.22%.

Note that the $2.644b loan (20 properties) was extended from a May 2012 maturity to a 2017 maturity, and this should result in a partial and substantial release from the loan.

I'd definitely keep an eye out on any current- or next-pay bonds on these deals. For example, it represents 15.66% of the collateral behind the WBCMT 2007-C31 A2 that is currently offered at 255 $104-11 - all else equal, if you assume the full sales price is released, you lose nearly 100 bps of yield and your bond shortens by over 1 year. And, as Barclays pointed out earlier this week, or maybe last week, the reserve requirements are likely to go down as well resulting in further releases.