Commercial Mortgage Alert (See “CMBS Deals in 17 CALENDAR the Works,” on Page 10)

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NOVEMBER 13, 2015 Fannie Seen in Line for StuyTown Financing Fannie Mae is the heavy favorite to win the $2.7 billion financing assignment on 10 CMBS DEALS IN THE WORKS the Stuyvesant Town and Peter Cooper Village apartment complexes in Manhattan. The agency has aggressively pursued the fixed-rate loan, outbidding both rival 2 Buysiders Wade Through New CMBS Freddie Mac and multiple commercial MBS shops, according to lenders. Late in the 2 Morgan Stanley Shuffles Executives week, Fannie appeared to be on the verge of getting the nod. A Blackstone partnership is seeking the 10-year loan to finance its $5.3 billion 4 Lenders Set for Hawaii Condo Project purchase of the massive complexes from special servicer CWCapital. The Blackstone team tapped the agency-loan arm of Wells Fargo to pitch the low-leverage assign- 6 CMBS Pros Mull Switch in Benchmark ment to Fannie and Freddie. Meanwhile, Wells affiliateEastdil Secured is overseeing 6 JP Morgan Funds Calif. Rental Project bids from CMBS lenders. Initially, securitization programs were given little chance of winning the loan. 6 Aegon Backs Seattle-Area Apartments But the rating agencies looked at the properties favorably. That enabled CMBS shops to offer tighter-than-expected loan spreads, narrowing the gap with the mortgage Builder Eyes Debt for Denver Rentals 8 See FANNIE on Page 12 12 Wells Finances Va. Industrial Purchase 12 Normandy Seeks Floater on DC Offices CMBS Issuers Foresee Quiet Finish to the Year 16 Loan Sought for Calif. Hotel Project It looks like the year is going to end with a whimper. Only about $13 billion of commercial MBS transactions are in the pipeline 15 INITIAL PRICINGS through December, with the bulk of that activity likely to hit by the end of this month, according to a survey by Commercial Mortgage Alert (see “CMBS Deals in 17 CALENDAR the Works,” on Page 10). That schedule puts U.S. issuance on track to slightly exceed $100 billion for the year. That would be a milestone for the industry — the first time it has surpassed the $100 billion barrier since 2007 — and up from 2014’s tally of $94.1 billion. But it would be far below the $124 billion projection by a panel of pros at the THE GRAPEVINE beginning of the year. So by the yardstick of expectations, 2015 is turning out to be a somewhat disappointing year for many, who say a variety of factors com- Jay Kirsch has joined Greystone as a bined to cast a malaise over the market for much of the second half (see article managing director, originating multi- on Page 1). family agency mortgages for the New CMBS issuers had hoped for the traditional late-year rush of transactions to give York firm’s small-balance loan program. See ISSUERS on Page 10 He started this week, reporting to senior managing director Rick Wolf, who heads Market Setbacks Leave CMBS Shops Gloomy up the program. Kirsch will split his time between offices in Philadelphia Shrinking profit margins and slowing originations are dampening the mood of and Rockville, Md. He previously spent commercial MBS lenders. seven years at Freddie Mac, leaving as a Over the past few months, issuers have been battered by wider bond spreads, client-relationship manager in the small- hedging losses and pushback from investors about credit quality. A new regulation balance program it rolled out last year. requiring CMBS executives to accept personal liability for securitizations has only added to the list of woes. Former Fitch and Moody’s staffer Moinul And small shops have another thing to worry about: that increasingly risk-averse Azam has signed on as director of banks will re-price or even withdraw the warehouse lines they depend on to finance product development at Morningstar, their originations. where he’ll work on improving and The upshot: CMBS lenders are as gloomy as they have been since the market expanding its securitization-analytics started to rebound from the financial crisis in 2011. products. Azam started Monday in The pros remain hopeful that things will turn around next year, as an anticipated See GRAPEVINE on Back Page See SETBACKS on Page 8 November 13, 2015 Commercial Mortgage 2 ALERT Buysiders Wade Through New CMBS Sept. 8 for Lone Star Funds of Dallas, along with a $126.5 million mezzanine loan that will be securitized separately (LSPT Commercial MBS buyers had a lot to choose from over the 2015-LSP MZ). The debt has a three-year term plus two one- past week, as dealers priced or marketed six conduit offerings year extension options. There are two classes of triple-A notes, totaling $5.1 billion, as well as $1 billion of floating-rate paper one of which was preplaced. Those available for purchase could via two transactions. be shopped at 165-bp area over one-month Libor, according to Only one of the fixed-rated conduit deals has priced so far, early “whisper talk” from dealers. The whispers on the subor- and that was a week ago. So CMBS traders and investors were dinate tranches ranged from 215-bp area on notes rated AA+/ looking to the rest to provide fresh indications of how spreads AA- by S&P and Fitch to 550-bp area on the BB-/B- paper. are holding up amid long-running volatility in broader finan- Those projections were based on a minimum weighted average cial markets. Initial price talk available yesterday pointed to a life of 2.8 years. slight widening in benchmark spreads. The other floater is a $305 million offering (MSC 2015- The long-term super-seniors in a $960.9 million issue led XLF2) backed by portions of two debt packages, totaling $539 by Deutsche Bank and Cantor Fitzgerald (COMM 2015-LC23) million, that Morgan Stanley originated separately last year priced in line with the dealers’ guidance last Friday at a spread on three malls owned by Starwood Capital and seven hotels of 122 bp over swaps (see Initial Pricings on Pages 15-16). owned by Ashford Hospitality. They have terms of up to five That fell between the issuance spreads of 120 bp and 127 bp years, including extension options. The price talk on the bonds on equivalent benchmark bonds in the two previous conduit collateralized by the Starwood debt ranged from 195 bp at the issues, which priced the week before (MSBAM 2015-C26 and triple-A level to 460-bp area on notes rated BBB-/BBB by Fitch WFCM 2015-C31). and Morningstar. Among classes backed by the Ashford debt, Price guidance on three of the five pending deals ranged the comparable guidance ranged from 197 bp on the senior from as low as 122 bp to as high as 128-bp area. The widest tranche to 420-bp area on the BBB-/BBB+ paper.  talk was on the benchmark class of a $939.6 million offering by Credit Suisse, Benefit Street Partners, Walker & Dunlop, Bancorp Morgan Stanley Shuffles Executives Bank and MC-Five Mile (CSAIL 2015-C4). At the other end of the investment-grade capital stack, the The U.S. head of securitization trading atMorgan Stanley triple-B-minus paper in that deal was being shopped at 600-bp has moved to a new client-focused role, and former commer- area. That was up from the 575-bp spread achieved on corre- cial MBS trader Kevin Ng has been tapped to replace her. sponding bonds in the COMM deal, which had been marketed Rebecca “Becca” Dorrian is now head of client services for at 590-bp area. The price talk was 420-bp area on the next- the global securitized-product group, which is led by Jay Hallik. higher class of triple-B notes in the CSAIL transaction. The Ng, meanwhile, is returning to the trading desk, this time with comparable tranche of the COMM issue, rated BBB/BBB+ by responsibility for residential MBS, asset-backed securities and Fitch and Kroll, priced at 405 bp — down from guidance of 410- CLOs, in addition to CMBS. He moved over from the CMBS 415 bp. lending unit, where his duties as head of capital markets for The tightest initial guidance yesterday came on an $820.6 commercial real estate lending included pricing and hedging million securitization of mortgages contributed by Goldman commercial mortgages that the bank warehouses for securiti- Sachs and CCRE (GSMS 2015-GS1). The benchmark bonds zation. were talked at 122-125 bp, while dealers were marketing the Hallik and Jeff Pagano, who runs fixed-income sales in triple-B-minus paper at 500-bp area. North America, announced the moves in an internal staff The price talk on the benchmark class of a $761.8 million memo last Friday. Dorrian reports to both of them, Ng answers transaction backed by loans from J.P. Morgan, Barclays, Ladder to Hallik and securitization sales chief Dam Simet works for Capital and Redwood Trust (JPMBB 2015-C33) was in the Dorrian. All five are managing directors in the bank’s New York middle, at 125-bp area. headquarters. Talk was still unavailable on the other conduits: an $822.3 Dorrian, who’s been with Morgan Stanley for 15 years, over- million offering byMorgan Stanley, Bank of America, CIBC and sees securitized-product sales, the syndicate desk and product Starwood Mortgage (MSBAM 2015-C27) and a $774.5 million management. She’s charged with spearheading “a unified and deal collateralized by loans from Wells Fargo, Natixis and systematic approach to our global distribution of securitized Silverpeak Real Estate (WFCM 2015-NXS4). products,” Hallik and Pagano wrote in their memo. Among Next up is a $1.1 billion conduit offering by Citigroup, other things, that will include “developing products and ser- Freedom Commercial Real Estate, Goldman and Rialto Capital vices in response to changing client needs.” (CGCMT 2015-GC35). Ng joined Morgan Stanley in 2004 and became head of sec- Meanwhile, investors were kicking the tires on a $705.3 ondary-market CMBS trading in mid-2009. In May 2014, he million securitization of senior floating-rate debt on 92 office was transferred to the lending side as part of a series of moves properties and 11 industrial properties in 18 states (LSPT 2015- in the bank’s commercial real estate operation that continued LSP). J.P. Morgan and Credit Suisse originated the mortgage on through the end of last year.  NATIONAL LEADER IN REAL ESTATE FINANCE Over $ Billion Loans Closed since 2010

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www.ccre.com | 212.915.1700 November 13, 2015 Commercial Mortgage 4 ALERT Lenders Set for Hawaii Condo Project Deutsche is administrative agent on the debt, which has an initial term of three years and a one-year extension option. Deutsche Bank is teaming up with Industrial and Commercial It’s co-leading the loan with ICBC. A number of banks are Bank of China to lead a $450 million debt package for a high- expected to take down pieces at the closing. They include end condominium development in Hawaii. American Savings Bank of Honolulu, Bank of Hawaii, CIT Real The floating-rate loan, expected to close within a couple of Estate Finance, MidFirst Bank and U.S. Bank. weeks, will finance the ongoing construction of the 215-unit Construction of the project’s first phase began in the sum- Park Lane Ala Moana project, near the oceanfront in Honolulu. mer of 2014 and is due for completion by the end of 2016. The The borrower is a partnership among General Growth Proper- second phase is scheduled to wrap up about a year later. The ties of Chicago and two Honolulu developers: Kobayashi Group site is adjacent to Ala Moana Center, a trophy mall that’s among and MacNaughton Group. the most lucrative retail properties in the country. The development will consist of seven six-story buildings in which each unit will have a view of the Pacific Ocean. The condos will have such luxury features as TRANSACTIONS SPEAK 10-foot ceilings, tropical gardens, private pools or spas and private garages. Unit prices start at $1.2 LOUDER THAN WORDS million and range up to $28 mil- OVER $30 BILLION SOLD lion for the five-bedroom pent- houses, with an average price in the neighborhood of $5 million. As of mid-September, nearly 65% of the condos had been pre-sold. Lender interest in condo- construction deals has waned over the past year or so, but high- quality projects in top locations still have little trouble securing financing. Park Lane fits the bill, with its units aimed at ultra-rich buyers and its location between Ala Moana Beach Park and the upscale mall. The site is on Ala Moana Bou- levard at Piikoi Street, about two miles from downtown Honolulu. General Growth owns Ala Moana Center, which it refinanced in 2012 with a $1.4 billion, 10-year loan that Goldman Sachs securitized in a stand-alone issue (GSMS 2012- ALOHA). The mall was appraised CLOSED OCTOBER 2015 at the time at $2.7 billion.  Upper East Side Multi-Family with River Views New York, NY • 25 Units • Interested Buyers: 257 Offers: 16 • Sales Price: $15,172,500 Drill down deep into our market statistics. Go to The Marketplace section of CMAlert.com and click on “CMBS Market Statistics,” INTERESTED IN SELLING? which lets you see the data www.auction.com/cma-sell points behind all the charts that Commercial Mortgage Alert SEARCH PROPERTIES: publishes each week. It’s free. www.auction.com/cma-buy WHERE REAL ESTATE IS MOVING™ $20,106,400 MULTIFAMILY – 4-PROPERTY PORTFOLIO HUD 223(f) MICHIGAN ■ $16,000,000 MULTIFAMILY FANNIE MAE DUS® NORTH PROVIDENCE, RI ■ $3,080,000 MULTIFAM- ILY FREDDIE MAC SMALL BALANCE BIRMINGHAM, AL ■ $25,000,000 MULTIFAMILY CMBS FAYETTEVILLE, NC ■ $10,000,000 MULTIFAMILY FANNIE MAE DUS® NORTHRIDGE, CA ■ $9,500,000 MULTIFAMILY FREDDIE MAC PROGRAM PLUS® ELMHURST, NY ■ $6,286,220 MULTIFAMILY FAN- NIE MAE DUS® CONOVER, NC ■ $3,100,000 MULTIFAMI- LY FANNIE MAE DUS® LEBANON, TN ■ $2,840,000 MUL- TIFAMILY FREDDIE MAC SMALL BALANCE DENVER, CO ■ $1,750,000 MULTIFAMILY FREDDIE MAC SMALL BALANCE SAVANNAH, GA ■ $36,000,000 RETAIL CMBS AVON, CO ■ 4,206,000 MULTIFAMILY FANNIE MAE DUS® ROCK HILL, SC ■ $1,617,000 MULTIFAMILY FREDDIE MAC SMALL BAL- ANCE BIRMINGHAM, AL ■ $6,835,000 MULTIFAMILY FAN- NIE MAE DUS® JACKSON, MS ■ $5,356,000 MULTIFAMILY FANNIE MAE DUS® AURORA, CO ■ $1,910,000 MULTIFAM- ILY FREDDIE MAC SMALL BALANCE LONGMONT, CO ■

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November 13, 2015 Commercial Mortgage 6 ALERT CMBS Pros Mull Switch in Benchmark Treasurys, market pros say, while increasing demand for the long side of swaps. What’s more, a bevy of new risk-based capi- With long-term yields on interest-rate swaps now lower tal rules has prompted many large banks to scale back bond than those on corresponding U.S. Treasurys, market pros are investments as they prepare to close their books for the year.  wondering if it’s time to go back to using government-bond rates as the basis for pricing commercial MBS. JP Morgan Funds Calif. Rental Project The idea increasingly has been discussed among dealers and CMBS buyers since last month, when the spread on 10-year J.P. Morgan has agreed to provide around $165 million of swaps went negative for the first time in five years. The prevail- financing for the construction of an apartment complex in Hol- ing swap rate was 9-12 bp lower than the equivalent Treasury lywood, Calif. yield this week, after running 5-15 bp higher for most of this The 513-unit building, called Southblock, will be the second year. phase of a residential development undertaken by the team of “It’s a topic that has come up quite a bit lately and people are Clarett West and DLJ Real Estate Capital. The duo began shop- buzzing about it,” one investor said. “The normal relationship ping for the floating-rate loan over the summer viaEastdil between swaps and Treasurys is not holding, and people are Secured. J.P. Morgan is expected to syndicate it. raising the question.” Construction of the seven-story building, which has already For more than a decade, yields on fixed-rate securitizations started, is scheduled to be completed in 2017. The site is at 6200 have been pegged to swaps, with a specific credit spread added Hollywood Boulevard, a block from Hollywood and Vine. The for each class of bonds. While Treasurys remain the standard property will include a five-level underground garage. pricing benchmark for unsecured corporate bonds, they haven’t The first phase of the project is a 535-unit building across been used with any regularity on private-label CMBS offerings the street, at 6201 Hollywood Boulevard. Bank of America led a since 2000. The last time they were seen on every tranche of loan of around $140 million that financed that portion, which a CMBS issue was in a single-borrower transaction floated 13 includes 74,000 square feet of retail space. DLJ, a New York years ago (CAREY 2002-1). investment manager, and Clarett West, which is affiliated with Following a prolonged Treasury rally in the late 1990s, secu- Clarett Group of New York, completed the building last year.  ritization issuers and investors gradually reached a consensus on switching to swaps, which more closely reflect movements Aegon Backs Seattle-Area Apartments in the broader credit market. “Swaps and Treasurys are both very liquid, but sometimes one is more liquid than the other, Aegon USA Realty has originated a $44 million fixed-rate and that’s what we’re seeing now,” one trader said. mortgage on a high-end residential building in one of Seattle’s No one has made a serious push yet for issuers to go back largest suburbs. to pricing CMBS deals off Treasurys. But the idea could gain The 148-unit property, at 288 106th Avenue Northeast traction if yields on swaps fall further below Treasury rates, in Bellevue, Wash., was completed last year by local shop Su some bond pros said. The relatively low swap rates drag down Development, which has already begun construction on a com- the overall yields on CMBS unless spreads on the bonds are panion building. The project is called Soma Towers. increased to compensate. Aegon closed the 8.5-year loan in the past few weeks. The So far, there’s been little impact, if any, on the pricing of mortgage is interest-only for two years, after which it amortizes new-issue CMBS. But if the gap between swap and Treasury on a 30-year schedule. Su was advised by DSC Capital of Seattle. yields widens by another 10 bp or so, one trader said, issuers The 22-story building has a media room, a penthouse lounge may be forced to boost credit spreads in order to meet some with an outdoor terrace, a fitness studio and an underground bond buyers’ targets for absolute yields. garage. The swaps themselves are traded as derivatives, allowing The companion building will have about 125 units, a lap counterparties to buy or offer protection against fluctuating pool, a movie room and several floors of retail space. Once it’s Treasury rates. Swap yields reflect the premium charged by completed, Su is expected to seek a mortgage whose maturity investors who take the long side of swaps and would have to would match the Aegon loan. Aegon would likely have a leg up compensate counterparties if relevant Treasury rates fell below on winning that assignment as well. the three-month Libor rate, which is currently 0.4%. The site is five blocks west of Interstate 405 and about 10 The 10-year swap rate stood at 2.20% yesterday, versus miles from downtown Seattle.  2.31% for comparable Treasurys. The swap rate had pulled even with Treasurys about a month ago, when the government-bond yield was hovering just over 2%. Since then, both instruments It is a violation of federal copyright law to reproduce any part have seen their prices drop and yields rise — but Treasurys of this publication or to forward it, or a link to it, without first have lost more of their value due to persistent volatility in the obtaining permission to Commercial Mortgage Alert. To request broader financial markets. copies for presentations or to expand your distribution rights, Indications that the Federal Reserve may start boosting contact JoAnn Tassie at 201-234-3980 or [email protected]. short-term interest rates next month have softened demand for Paid Advertisement The real estate cycle: The inevitable rebound of rates Late-year increase expected after Fed delays rate liftoff

nterest rate sensitivity is is a major factor. For example, with the somewhat as lenders manage asset class high on the radar screens 10-year Treasury note paying near 2%, and and market capital exposures. Favored of Bank of America cap rates, or cash flow as a percentage of investments are multifamily, transit-oriented Merrill Lynch clients. property value, near 5%, there’s a reasonable and downtown properties. Secondary and Markets are closely return for the additional risk involved with tertiary real estate markets are benefiting monitoring the actions a real estate investment. But when the risk from the flood of investor capital that is and words of Fed Chair premium narrows, real estate investors are seeking yield. Mark Sharer Janet Yellen and savvy real more selective and capital flows to other Barring a rapid or aggressive tightening of Mid-Atlantic estate investors are also asset classes. the money supply by the Federal Reserve, Market Executive paying closer attention to In terms of availability of capital, private which is not expected, the Goldilocks Bank of America Merrill Lynch treasury rates and bond equity groups play more in the property economy — not too hot or too cold — appears markets overall. acquisition game as financing is readily to be in balance. Regardless of the interest rate Many BofAML clients understand that available and less expensive for them. environment, Bank of America Merrill Lynch a rate hike is likely before year’s end, and Private middle-market clients are choosing maintains its commitment to be a provider that is the view of BofAML economists. development and construction of new of real estate capital, market intelligence and However, it is the severity of the increase properties, particularly multifamily. Prices, or advice to clients. that has the potential to have the most spreads on loans, for those have increased impact on capital markets. “The consensus expectation of our customers is that interest rates will increase gradually,” said Mark Sharer, Mid-Atlantic Market Executive for Bank of America Merrill Lynch. “There have been increases in the past where the Fed raised rates 200 basis points within a year, which led to economic volatility. The change in velocity of interest rates is data dependent, and right now there’s not material concern about inflationary pressures.” The Fed said it will likely raise interest rates if both job growth and inflation are in place. Throughout the first three quarters of 2015, economic data revealed a steadily strengthening economy, led by job creation and an unemployment rate that Federal Reserve economists estimate will hit 5% by year’s end. Companies are not only creating jobs, but are increasing wages, an inflationary pressure. Make your mark in Bank of America Merrill Lynch research commercial real estate. shows that the employment cost index has accelerated in relation to productivity growth, bofaml.com/commercialre foretelling a rise in inflation toward the Fed’s 2% target. However, the Fed delayed a rate hike at its September meeting because of several deflationary warning signs. While there isn’t a direct connection between the various tools the Fed has to tighten the money supply and commercial real estate loan rates, supply and demand For marketing disclaimer, visit bankofamerica.com/disclaimer. ©2015 Bank of America Corporation 10-15-0959

CAD-10-15-0959.indd 1 11/3/15 12:31 PM November 13, 2015 Commercial Mortgage 8 ALERT Builder Eyes Debt for Denver Rentals response to deteriorating credit standards for CMBS loans.” The REIT noted that some borrowers have pulled back from Shorenstein Properties is seeking a $130 million construc- the market because of the volatility and that CMBS lenders tion loan for a downtown Denver apartment complex. were facing more-aggressive competition from portfolio lend- The San Francisco fund operator is asking lenders for pro- ers. posals on a three-year mortgage with a floating rate to finance Because of the conditions, Redwood added, it now expects the 508-unit project, near the city’s transportation hub. The to fall short of its projected annual origination total of at least leverage would be 65%, pegging the estimated cost at $200 mil- $1 billion and its projected 1.5% profit margin. lion. Eastdil Secured is marketing the assignment to banks and Meanwhile, Ladder chief executive Brian Harris told stock life insurers. analysts that “market conditions in the third quarter were Called The Commons in Denver, the property will consist about as difficult to operate in as I can recall in recent memory.” of two connected buildings, one with 24 stories and the other He went on to note that Ladder’s conduit business generated a with 12. It will have studio, one- and two-bedroom units and return of 1.42% — a big drop from its whopping second-quar- 20,000 square feet of street-level retail space. Plans call for a ter return of 4.64%. pool, a rooftop clubroom and 500 parking spaces. Others said they were worse off. “I’ll take Brian’s one-and-a- The project is at 1709 Chestnut Place, next to Commons half points,” complained one lender at a big CMBS shop. “A lot Park, a patch of green along the South Platte River. Site prepa- of us out here are scratching to get by.” ration has begun, with construction expected to follow in the Many lenders at the large issuing banks are optimistic that first quarter and to be completed by the end of 2017. A nearby the fallout will be temporary. “We still think 2016 is going to be Whole Foods also is expected to open that year. a big year,” said one lending veteran. “There will be some speed The project is in the coveted “LoDo,” or Lower Downtown bumps, but all the signs point to a better year.” district, a few blocks from the ongoing Union Station rede- Lenders at smaller operations, however, are feeling squeezed. velopment project that’s attracting an influx of businesses and They are concerned that their value to the issuing banks that residents. put conduit deals together is falling. Denver’s rental market continues to be among the strongest One factor they cite for that concern: The small group of in the country, propelled by job growth and a diverse economy, giant banks — including Deutsche Bank and Wells Fargo — with government, energy and technology sectors all having a that provide warehouse financing to lenders have tightened the big presence. The average occupancy rate is expected to end the screws in recent months. Some are refusing to expand existing year at 95.2%, down slightly from last year because of a large lines or to open new ones. “The banks are honoring their exist- number of developments set for delivery by yearend, according ing lines, but they’re not offering new ones,” said one lender. to Marcus & Millichap. The rate is projected to tick up again in One established small-shop lender said he was recently the first quarter of 2016, when project completions slow. rebuffed when he tried to arrange additional warehouses lines. “I’ve had a good relationship for years with one issuer, but we wanted to line up additional exits,” he said. “I called around, Setbacks ... From Page 1 but they all turned me down.” spike in refinancing activity gains speed. But for now, they said, “The little guys just don’t matter as much now,” said one it remains a hard slog. lending veteran at a mid-sized conduit shop. “With most deals “Spreads have been a disaster,” groaned one specialty- inside of $1 billion [in size], you don’t need the little guy’s loans finance shop executive. “Hedging has been a disaster. We’re so much anymore. As soon as you go past $1.25 billion, the looking at adding a bridge-lending business next year to help spreads go out, so you want to keep the pools fairly small.” diversify our income stream.” In addition, issuers may be hesitant to “certify” the collat- The head of one big CMBS shop said the setbacks have piled eral of smaller lenders under a new regulation. The rule, which up this year. “First, investors got deal fatigue on the single- takes effect Nov. 24, is part of the latest version of “Regulation borrower stuff,” he said. “Then conduit spreads blew out, and AB,” the SEC’s sweeping set of disclosure rules for all types of investors started pushing back on credit quality.” Add to that an securitizations. It requires a senior CMBS executive to assume increase in hedging losses. “It’s been a perfect storm,” he said. personal liability for each securitization by certifying that Two publicly traded conduit shops — Ladder Capital and deal information supplied to investors is accurate. It could Redwood Trust — cited the difficult atmosphere in their third- leave signers vulnerable to civil lawsuits by investors or to SEC quarter earnings reports. charges of civil violations of securities law.  The condition of the CMBS market has been “far less than optimal” and “remains concerning,” Redwood said. “Triple-A credit spreads for CMBS widened by another 20 basis points Planning Your Travel Schedule? Check out the most to their highest level in two years. Credit spreads widened in comprehensive listing of upcoming conferences in real estate response to a general nervousness and uncertainty in most finance and securitzation — in The Marketplace section of fixed-income markets, but also due to ongoing pushback by CMAlert.com. Just click on “Conference Calendar.” triple-A investors, B-piece buyers and the rating agencies in Fitch Ratings has been rating U.S. CMBS transactions for twenty-ﬁ ve years.

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have become more competitive. Also, after getting burned by Issuers ... From Page 1 lower-than-expected bond prices on early-year transactions, issuance a boost. But fourth-quarter volume is on track to some dealers have become more cautious. reach only $26 billion, below the $27.3 billion average in the “You saw new dealers come into the large-loan space this first two quarters of the year, although higher than the third- year who were willing to price their loans according to specula- quarter tally of $23.1 billion. tive models,” said one large-loan veteran. “But they misjudged To be sure, additional transactions can still materialize. Most the investor response, and margins got drastically compressed notably, CMBS shops were still holding out hope this week of as a result. So where we used to work for a [profit margin of landing the financing assignment for a Blackstone partnership’s one percentage] point on the big loans, we now work for half pending $5.4 billion purchase of the Stuyvesant Town and Peter a point.” With margins sliced so thin, he added, lenders reas- Cooper Village apartment complexes in Manhattan. But that sessed the risk and bypassed some loan opportunities. seemed like a long shot, with signs emerging late in the week Conduit transactions dominate the pipeline, with nine that Fannie Mae was in the lead for the financing. And even offerings scheduled through December. Among them is an with a few extra deals, the total activity would still generally be $821 million offering byGoldman Sachs and CCRE that is considered underwhelming. already in the market. CCRE apparently was eager to conduct Only three of the 15 transactions in the pipeline through an additional transaction of $900 million or so by yearend, December are single-borrower deals, continuing a shift from early but was unable to meet that timeframe. Multiple sources said in the year. Such offerings accounted for nearly half of issuance in the shop then briefly explored selling its collateral before the first quarter, but their share has been on the decline since. deciding to securitize the loans in January via a transaction CMBS lenders cite two reasons. First, banks, insurers, with Liberty Island. A CCRE spokeswoman declined to com- REITs, fund shops and other competing balance-sheet lenders ment. 

CMBS DEALS IN THE WORKS

November Amount Seller/Borrower Lead Managers Deal Type Rate Type ($Mil.) Global Logistic Properties (industrial portfolio) Credit Suisse, Morgan Stanley Single borrower Fixed $2,000 Citigroup, Goldman Sachs, Rialto, Freedom Comm. (CGCMT 2015-GC35) Citigroup, Goldman Sachs Conduit Fixed 1,100 C. Suisse, Benefit, Walker & Dunlop, Bancorp, MC-Five (CSAIL 2015-C4) Credit Suisse Conduit Fixed 940 UBS, Morgan Stanley (MSCM 2015-UBS 8) Morgan Stanley, UBS Conduit Fixed 900 Morgan Stanley, BofA, CIBC, Starwood Mortgage (MSBAM 2015-C27) Morgan Stanley, BofA Conduit Fixed 822 Goldman Sachs, CCRE (GSMS 2015-GS1) Goldman Sachs, CCRE Conduit Fixed 821 Wells Fargo, Natixis, Silverpeak (WFCM 2015-NXS4) Wells Fargo, Natixis Conduit Fixed 775 J.P. Morgan, Barclays, Ladder Capital, Redwood (JPMBB 2015-C33) J.P. Morgan, Barclays Conduit Fixed 762 Lone Star Real Estate Fund 4 (office/industrial portfolio) (LSPT 2015-LSP) J.P. Morgan, Credit Suisse Single borrower Floating 705 Starwood, Ashford Hospitality (retail, hotel portfolios) (MSC 2015-XLF2) Morgan Stanley Single borrower Floating 305 ReadyCap Commercial J.P. Morgan Small balance Fixed 200

December Amount Seller/Borrower Lead Managers Deal Type Rate Type ($Mil.) Wells, Citigroup, Principal, Ladder, Societe Generale (CGCMT 2015-P2) Wells Fargo, Citigroup Conduit Fixed $1,100 Credit Suisse, LoanCore Capital, Rialto, Silverpeak (CSAIL 2015-C5) Credit Suisse Conduit Fixed 900 Deutsche Bank, CCRE, LoanCore Capital (COMM 2015-CCRE28) Deutsche, Cantor Fitzgerald Conduit Fixed 900 J.P. Morgan, Barclays, Starwood, Redwood (JPMBB 2015-C34) J.P. Morgan, Barclays Conduit Fixed 900

January Amount Seller/Borrower Lead Managers Deal Type Rate Type ($Mil.) CCRE, Liberty Island Cantor Fitzgerald Conduit Fixed $900 Morgan Stanley, Bank of America, CIBC, Starwood (MSBAM 2015-C28) Morgan Stanley, BofA Conduit Fixed 900 Wells Fargo, Rialto, others (WFCM 2015-C32) Wells Fargo Conduit Fixed 900 BROOKFIELD REAL ESTATE FINANCIAL PARTNERS QUICK, FLEXIBLE, RELIABLE.

THE BRILL BUILDING THE GRAND AT SKY VIEW PARC NY TIMES RETAIL CONDO New York, NY Flushing, NY New York, NY Mixed-Use Repositioning Residential Condominiums Retail Refinancing Construction Financing Acquisition Financing June 2015 July 2015 October 2015 $246,800,000 $440,000,000 $286,767,050

180 WATER STREET AIRPORT BUSINESS CENTER LATITUDE 34 New York, NY Irvine, CA Playa Vista, CA Rental Conversion Stabilized Industrial Flex Office Repositioning Renovation Financing Refinancing Acquisition Financing May 2015 October 2014 July 2014 $240,000,000 $158,000,000 $132,000,000

2155 WEBSTER USA TODAY TOWERS PARK WEST VILLAGE San Francisco, CA McLean, VA New York, NY Condominium Conversion Office Repositioning Rent Stabilized Residential Renovation Financing Mezzanine Loan Refinancing November 2014 October 2015 August 2014 $117,280,928 $50,000,000 $184,750,000

Brookfield Real Estate Finance. With a 13-year track record of providing fast and flexible financing solutions and the ability to make principal investments of over $400 million on individual transactions for all CRE asset types, we can tailor a deal to suit your investment’s capital needs.

Christopher Reilly [email protected] 212.417.7289 brookfield.com November 13, 2015 Commercial Mortgage 12 ALERT Wells Finances Va. Industrial Purchase downtown Washington with a concentration of upscale shops, restaurants and hotels. It’s within a couple of blocks of Metro’s Wells Fargo has provided $48 million of floating-rate debt Farragut West and Farragut North stops and a few blocks south to back the purchase of a large industrial property in Northern of DuPont Circle.  Virginia. The borrower, a partnership between MRP Realty of Wash- Fannie ... From Page 1 ington and J.P. Morgan Asset Management, paid about $86 million for the 814,000-square-foot Northern Virginia Industrial agencies and putting them in the game. Park, in Lorton. The seller was a joint venture betweenAdler Most of the major CMBS programs made bids, with some Group of Miami and Los Angeles-based Ares Management. The teaming up. A solo bid by J.P. Morgan was described as espe- acquisition and the financing closed last week. cially aggressive. That bank was likely encouraged by the tight The loan from Wells has a five-year term, and the bank is spreads it achieved on a $500 million securitization last month expected to retain it on its balance sheet. The collateral encom- that was backed by five-year, fixed-rate loans it had written on passes 15 buildings about two miles from Interstate 95 and four luxury Manhattan apartment buildings owned by Sheldon roughly 18 miles south of Washington. The one- and two-story Solow. The triple-A tranche priced at swaps plus 90 bp. flex and warehouse structures are about 75% leased. For their part, the agencies benefited from their ability to The broker on the property sale,Transwestern, noted that provide “top-off” financing. The agencies are willing to -con the surrounding area has seen a spate of residential construc- sider increasing the sizes of loans down the road if net operat- tion in recent years, reducing the land available for large-scale ing income improves. That would enable the borrowers to take warehouse development. That, it said, provides opportunity to additional cash out of the properties without incurring the cost increase rents on well-located existing properties. The build- of refinancing. CMBS lenders can’t offer such an option. ings are clustered around 7347 Lockport Place, adjacent to The Blackstone partnership took initial bids last Friday. It Davison Army Airfield. had asked for proposals with combinations of seven- or 10-year terms, and fixed or floating rates. Fannie’s offers were described Normandy Seeks Floater on DC Offices as significantly better than the others, which were clustered fairly close. Normandy Real Estate is looking for roughly $40 million of By Tuesday of this week, the Blackstone team had settled on debt to finance its pending acquisition of a downtown Wash- a 10-year, fixed-rate loan and asked for “best and final” bids. ington office building. After those offers were submitted, rivals said, Fannie appeared The Morristown, N.J., investment firm has agreed to pur- to have the assignment sewn up, with a bid of Treasurys plus chase the 103,000-square-foot property, at 1015 18th Street about 120 bp. Freddie’s bid was about 15 bp wider, and most of NW, from local owner Donohoe Cos. for about $58 million. the CMBS bids were close to Freddie’s offer. All of the parties Normandy prefers a floating-rate loan with a term of five involved declined to comment. years. Eastdil Secured is pitching the assignment to banks and If Fannie is chosen, it will be a coup for Wells, which will debt funds. originate the debt and sell it to the agency. Blackstone wants to The Class-B property is 78.8% leased to about two dozen close the purchase of the apartment complexes by yearend, but tenants, according to CoStar. Constructed in 1970 and reno- Fannie might be unable to buy the loan this year because of its vated in 1986, it features a two-story lobby with black marble $30 billion annual purchase limit. If so, Wells would warehouse and wood trim. There is parking for 120 cars. the loan until Fannie gets new purchasing capacity in January. Donohoe acquired the property in 2003 from Harbor Group In the first 10 months of the year, Fannie purchased $34.8 International of Norfolk, Va., for $27.6 million. Harbor had billion of multi-family loans, including perhaps $10 billion of bought it the year before from Illinois State Teachers for $21 affordable mortgages, which are exempt from the cap but aren’t million and leased up substantial vacant space. specifically disclosed until yearend. That would mean Fan- The 11-story building is in the Golden Triangle, a portion of nie could buy only $5 billion to $6 billion of capped loans in November and December — and it already has another giant transaction in the works. Fannie has agreed to buy $2.5 billion Checking Out a Borrower? of mortgages from Wells to help Starwood Capital of Green- wich, Conn., finance its pending $5.4 billion purchase of 72 Sizing Up a CMBS Issue? apartment communities from Equity Residential of Chicago. Starwood has also lined up $1.5 billion of Freddie loans via Instantly find whomever or whatever you’re looking for Berkeley Point Capital of Bethesda, Md. by searching Commercial Mortgage Alert’s archives A portion of the Stuyvesant Town deal is expected to qualify and the CMBS Database at CMAlert.com. Free for as affordable. Blackstone and its partner, Ivanhoe Cambridge Commercial Mortgage Alert subscribers. of Montreal, have agreed to maintain about 5,000 of the complexes’ 11,241 units as affordable for 20 years. B:9 in T:8.5 in S:7.75 in

BILLION-DOLLAR DEALS ARE BECOMING SOMETHING OF A HABIT FOR US. S:10.25 in B:11.5 in T:11 in

$5.1B 107 9 36,207+ FINANCING INDIVIDUAL STATES UNITS LOANS

This summer, Berkadia Commercial Mortgage LLC delivered Freddie Mac ﬁnancing for a $5.1 billion Lone Star acquisition. This marks Berkadia’s fourth deal above $1 billion in the past four years, demonstrating the depth of our relationships with capital sources and 24/7 support. And yet, the big deals don’t deﬁne us. Our market knowledge, plus unparalleled experience in mortgage banking, investment sales and loan servicing, deliver certainty of execution that our clients depend on�—� for middle market deals as much as billion-dollar ones.

BERKADIA.COM

Commercial mortgage loan banking and servicing businesses are conducted exclusively by Berkadia Commercial Mortgage LLC and Berkadia Commercial Mortgage Inc. Investment sales/real estate brokerage business is conducted exclusively by Berkadia Real Estate Advisors LLC and Berkadia Real Estate Advisors Inc. In California, Berkadia Commercial Mortgage LLC conducts business under CA Finance Lender & Broker Lic. #988-0701, Berkadia Commercial Mortgage Inc. under CA Real Estate Broker Lic. #01874116, and Berkadia Real Estate Advisors Inc. under CA Real Estate Broker Lic. #01931050. For state licensing details for the above entities, visit: www.berkadia.com/legal/licensing.aspx. ©�2015 Berkadia Commercial Mortgage LLC. Berkadia® is a registered trademark of Berkadia Proprietary Holding LLC.

Ad for Commercial Mortgage Alert CLIENT/BRAND JOB NUMBER PROJECT INKS Berkadia 1800-012-01 Lone Star Deal Ad Cyan, Magenta, Yellow, Black

LINKS CONTACT FILE NAME LAST MODIFIED DUE .L[[` F]FZJFÅH[WZK(303 ppi; CMYK), )LYRHKPHFI`SPULF26F*4@2 Elise Bittner 1800-012-01_CMA_Ad_r01.indd 11-9-2015 10:33 11/12/15 LWZ, )LYRHKPHF9F26F*4@2LWZ [email protected] AM 312.895.5074 Dir NOTES 312.427.6413 Tel VERSION/AD ID BINDING PAGE N/A Commercial Mortgage Alert N/A 1 of 1 TEAM INITIAL CE M. Walsh ______PM E. Bittner ______TACTIC SCALE INTERNAL Full Page Ad 1 in = 1 in Claudia Alberts CD D. Harbarger ______None DS B. Hernalsteen ______BLEED (FINAL SCALE) FLAT (FINAL SCALE) LIVE (FINAL SCALE) FINISHED SIZE CW B. Maday ______0.25 inW x 0.25 inH 8.5 inW x 11 inH 0.375 inW x 0.375 None PP J. Niccum ______inH PR S. Baker ______FOLDS OR PANELS GUTTER OVERPRINT AB S. Rowe RT P. Haggard None: None None GREEN ON PD C. Alberts DD T. El-Mofty YELLOW OFF

ISO 12647-7 Digital Control Strip 2009 3% A 100 60 100 70 30 100 60 100 70 30 100 60 100 70 30 100 40 40 100 40 100 40 70 40 70 40 40 40 70 40 40 70 40 70 40 40 3 10 25 50 75 90 100

B 100 100 60 100 100 70 70 30 30 100 100 60 100 100 70 70 30 30 100 100 60 100 100 70 70 30 30 100 40 100 40 40 100 10 40 40 20 70 70 70 70 40 70 40 40 0 0 0 0 3.1 2.2 2.2 10.2 7.4 7.4 25 19 19 50 40 40 75 66 66 100 100 100 80 70 70 100 Early

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INITIAL INITIAL PRICINGS PRICINGS

COMM Mortgage Trust, 2015-LC23

Pricing date: Nov. 6 Property types: Retail (32.4%), office (28.5%), hotel (19.9%), multi-family (12.8%), Closing date: Nov. 17 industrial (3.9%), manufactured housing (1.3%), mixed-use (0.8%) and self-storage Amount: $960.9 million (0.4%). Concentrations: California (26.5%) and New York (20.7%). Deutsche Bank, Loan contributors: Deutsche (41.1%), Ladder (30.6%), CCRE (16.5%) and Jefferies Ladder Capital Finance, (11.8%). Seller/borrower: Largest loans: An $80 million portion of a $232 million loan to American Realty CCRE, Capital on 21 hotels, totaling 2,690 rooms, in 13 states; a $70 million portion of a Jefferies LoanCore $425 million loan to Rudin Management on the 1.2 million-sf office building at 32 Deutsche Bank, Avenue of the Americas in Manhattan; a $69.6 million senior portion of a $1.1 bil- Lead managers: lion loan to SL Green Realty on the 2.3 million-sf office tower at 11 Madison Ave- Cantor Fitzgerald nue in Manhattan; a $46 million loan to Spruce Capital on the 127-unit apartment Jefferies, building at 1209 DeKalb Avenue in Brooklyn; a $42.7 million loan to Boulevard Co-managers: Investment on the 146,000-sf Good Samaritan Medical Tower in Los Angeles; a Wells Fargo $42 million portion of a $109.9 million loan to Dunes Point Capital on 29 industrial Wells Fargo, properties and one office building, encompassing 2 million sf, in seven states; a Master servicers: $40 million loan to Northview Hotel Group on the 202-room Beach House Hilton KeyBank Head hotel on Hilton Head Island, S.C.; a $35.9 million loan to SB Yen Management LNR Partners, on the 222-room Whitehall Hotel in Chicago; a $32.9 million loan to R&M Properties Special servicers: KeyBank, and NorthWall Builders on the 30,000-sf office condominium at 611 Cowper Street in Palo Alto, Calif.; and a $32.5 million portion of a $64.9 million loan to Simon Rialto Capital Property and Pennsylvania Real Estate Investment on the 611,000-sf Springfield Operating advisor: Park Bridge Lender Services Mall in Springfield Township, Pa. B-piece buyers: LNR Partners (60%) and Seer Capital (40%). Trustee: Wilmington Trust Notes: Deutsche, Ladder, CCRE and Jefferies teamed up to securitize commercial Certificate administrator: Wells Fargo mortgages that they had originated. Deal: COMM 2015-LC23. CMA code: 20150254. Offering type: SEC-registered

Amount Rating Rating Rating Subord. Coupon Dollar Yield Maturity Avg. Life Spread Class ($Mil.) (Moody’s) (Fitch) (Kroll) (%) (%) Price (%) (Date) (Years) (bp) Note Type A-1 39.109 Aaa AAA AAA 30.00 1.811 99.998 1.801 10/10/48 2.67 S+62 Fixed A-2 210.190 Aaa AAA AAA 30.00 3.221 102.999 2.564 10/10/48 4.89 S+90 Fixed A-SB 53.371 Aaa AAA AAA 30.00 3.598 102.996 3.149 10/10/48 7.40 S+115 Fixed A-3 125.000 Aaa AAA AAA 30.00 3.521 100.998 3.415 10/10/48 9.79 S+121 Fixed A-4 244.968 Aaa AAA AAA 30.00 3.774 102.993 3.429 10/10/48 9.85 S+122 Fixed A-M 61.258 Aa2 AAA AAA 23.63 4.158 102.995 3.812 10/10/48 9.90 S+160 Fixed B 51.649 A1 AA- AA 18.25 4.459 102.993 4.112 10/10/48 9.90 S+190 Fixed C 43.241 NR A- A 13.75 4.646 98.044 4.962 10/10/48 9.90 S+275 Fixed D 28.828 NR BBB BBB+ 10.75 3.646 81.402 6.262 10/10/48 9.90 S+405 Fixed E 24.022 NR BBB- BBB- 8.25 3.646 71.181 7.968 10/10/48 9.98 S+575 Fixed F 22.822 NR BB- BB 5.88 10/10/48 9.98 Fixed G 10.810 NR B- B+ 4.75 10/10/48 9.98 Fixed H 12.012 NR NR B- 3.50 10/10/48 9.98 Fixed J 33.632 NR NR NR 0.00 10/10/48 9.98 Fixed X-PA(IO) 733.896* Aa1 AAA AAA 10/10/48 Fixed X-SA(IO) 733.896* Aa1 AAA AAA 10/10/48 Fixed X-B(IO) 94.890* NR A- AAA 10/10/48 Fixed X-C(IO) 52.850* NR BBB- BBB- 10/10/48 Fixed X-D(IO) 22.822* NR BB- BB 10/10/48 Fixed X-E(IO) 22.822* NR NR B- 10/10/48 Fixed X-F(IO) 33.632* NR NR NR 10/10/48 Fixed *Notional amount

November 13, 2015 Commercial Mortgage 16 ALERT Loan Sought for Calif. Hotel Project The 11-story hotel, to carryMarriott International’s Autograph Collection brand, would have 20,000 sf of meeting space and a A developer is in the market for about $100 million of debt 40,000-sf fitness center. It’s expected to open in early 2018. to finance construction of a luxury hotel in Silicon Valley. As the hotel nears completion, Ensemble and Aecom plan to The 250-room hotel is the first phase of a planned mixed- start work on three office buildings totaling 694,000 square feet use project in Menlo Park, Calif. The sponsor is a partnership that would contain some shops and restaurants, plus several between Ensemble Investments of Long Beach, Calif., and an garages. The complex would be on a 16-acre parcel between investment affiliate ofAecom Technology of Los Angeles. Independence and Constitution Drives, on the northern side The loan-to-cost ratio would be about 65%, sources said, of Menlo Park. indicating a price tag of over $150 million. That suggests a The surrounding area is home to a number of top technol- change from preliminary plans, which projected the cost at ogy companies and venture capital firms.Facebook’s campus is closer to $110 million. less than a mile away. 

INITIAL INITIAL PRICINGS PRICINGS

B2R Mortgage Trust, 2015-2

Pricing date: Nov. 10 Closing date: Nov. 24 Amount: $301.0 million Seller/borrower: B2R Finance Property types: Residential rentals (100%). Concentrations: Florida (24.2%) and Texas (11.6%). Wells Fargo, Notes: B2R Finance, a Blackstone affiliate, securitized 211 residential-rental Lead managers: Citigroup loans it had recently originated for multiple borrowers. The fixed-rate loans are backed by 4,272 single-family, multi-family and condominium properties that are Co-manager: Goldman Sachs rented. The loan sizes range from $294,000 to $33.3 million. The loans have Master servicer: Midland Loan Services original terms of 5-10 years and a weighted average remaining term of 78 months. The weighted average coupon is 5.74%. The properties were appraised Special servicer: Midland Loan Services at $537.8 million. B2R is retaining Classes G and H. Trustee: Wilmington Trust Certificate administrator: Wells Fargo Offering type: Rule 144A

Amount Rating Rating Subord. Coupon Dollar Yield Maturity Avg. Life Spread Class ($Mil.) (Fitch) (MStar) (%) (%) Price (%) (Date) (Years) (bp) Note Type A 191.871 AAA AAA 36.25 3.336 99.999 3.328 11/15/48 4.55 S+175 Fixed B 31.226 AA- AA- 25.88 4.867 102.998 4.405 11/15/48 7.54 S+240 Fixed C 17.682 A- A- 20.00 5.492 100.288 5.785 11/15/48 9.52 S+360 Fixed D 22.573 BBB- BBB 12.50 5.492 92.185 6.953 11/15/48 9.74 S+475 Fixed E 13.544 BBB- BBB- 8.00 5.492 87.233 7.713 11/15/48 9.86 S+550 Fixed F 14.296 NR BB- 3.25 11/15/48 9.89 Fixed G 3.762 NR B- 2.00 11/15/48 9.89 Fixed H 6.019 NR NR 0.00 11/15/48 9.90 Fixed X-A(IO) 191.871* AAA AAA 11/15/48 Fixed X-B(IO) 48.908* A- AAA 11/15/48 Fixed X-C(IO) 60.194* NR NR 11/15/48 Fixed *Notional amount

November 13, 2015 Commercial Mortgage 17 ALERT CALENDAR CALENDAR

Main Events Dates Event Location Sponsor Information Jan. 11-13, 2016 CREFC Industry Leaders Conference 2016 Miami CREFC www.crefc.org Jan. 31-Feb. 3 CREF/Multifamily Housing Convention & Expo Orlando MBA www.mortgagebankers.org May 22-25 Commercial/Multifamily Servicing & Technology Conf. Dallas MBA www.mortgagebankers.org June 13-16 CREFC Annual Conference 2016 New York CREFC www.crefc.org Sept. 7-9 CMBA Western States CREF Las Vegas CMBA www.cmba.com

Events in US Dates Event Location Sponsor Information Nov. 17 After-Work Seminar Orlando CREFC www.crefc.org Nov. 18 High Yield Lending Trends New York CREFC www.crefc.org Nov. 18-20 Accounting & Financial Management Conference New Orleans MBA www.mortgagebankers.org Nov. 19 Capital Markets in Real Estate New York NYU Schack www.scps.nyu.edu Nov. 19 Building Legacies Washington RELA www.rela.org Dec. 2 Reg AB II-New Changes or Business as Usual? New York CREFC www.crefc.org Dec. 2 Networking Event New York YREPNY www.yrepny.org Dec. 2 Real Estate Mezzanine Lending New York MBAof NY www.mbany.org Dec. 2-3 Non-Traded REIT & Retail Alternative Inv. Symposium Dana Point, Calif. IMN www.imn.org Dec. 2-4 CLO Summit Carlsburg, Calif. Opal Financial www.opalgroup.net Dec. 2-4 Single Family Rental Investments Forum (West) Scottsdale, Ariz. IMN www.imn.org To view the complete conference calendar, visit The Marketplace section of CMAlert.com

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MARKET MONITOR

WORLDWIDE CMBS ISSUANCE ($Bil.) WORLDWIDE CMBS CMBS SPREADS 2014 2015 01/06/00 J 0.0 0.0 100 Year-to-date volume ($Bil.) NEW-ISSUE SPREAD OVER SWAPS 01/13/00 1.6 0.0 2015 2014 90 140 01/20/00 2.1 0.2 US 88.6 79.9 10-Year AAA 80 01/27/00 4.2 2.5 Non-US 5.2 4.5 130 70 02/03/00 F 6.4 5.5 TOTAL 93.8 84.4 120 60 02/10/00 7.9 11.9 2014 110 02/17/00 8.9 14.0 50 02/24/00 10.0 14.2 40 100 03/02/00 M 11.5 17.7 30 2015 90 03/09/00 13.2 20.8 20 80 03/16/00 16.1 20.8 10 70 03/23/00 17.6 24.3 0 J F M A M J J A S O N 03/30/00 20.9 26.7 J F M A M J J A S O N D

04/06/00 A 20.9 30.9 Spread (bp) US CMBS CMBS TOTAL RETURNS New Issue 04/13/00 21.1 33.6 Fixed Rate Avg. Week 52-wk 04/20/00 21.3 35.9 (Conduit) Life 11/11 Earlier Avg. MONTHLY ISSUANCE ($Bil.) CMBS INDEX 5.0 S+79 S+79 65 AAA 04/27/00 21.4 37.8 10.0 S+125 S+125 98 15 Total Return (%) 05/04/00 25.7 38.1 AA 10.0 S+213 S+211 161 Avg. Month Year Since 12 05/11/00 M 27.0 41.2 As of 11/10 Life to Date to Date 1/1/97 A 10.0 S+275 S+273 215 05/18/00 27.3 45.4 9 Inv.-grade 5.5 -0.6 1.5 210.8 BBB- 10.0 S+506 S+499 393 AAA 5.9 -0.7 1.6 195.5 Spread (bp) 05/25/00 30.3 45.8 Legacy 6 AA 4.1 -0.4 1.0 89.6 06/01/00 30.9 46.6 Fixed Rate Avg. Week 52-wk 3 A 3.8 -0.4 1.1 75.0 (Conduit) Life 11/11 Earlier Avg. 5.0 S+164 S+160 126 06/08/00 36.0 49.2 BBB 4.5 -0.5 0.8 83.5 AAA 10.0 S+143 S+142 118 06/15/00 J 37.0 51.9 0 Source: Barclays S O N D J F M A M J J A S O N AA 10.0 S+987 S+986 956 06/22/00 40.2 54.3 A 10.0 S+1,462 S+1,461 1,427 06/29/00 42.2 56.6 BBB 10.0 S+3,069 S+3,069 3,026 LOAN SPREADS 07/06/00 43.5 59.0 Dollar Price 07/13/00 J 44.2 59.4 Week 52-wk ASKING SPREADS OVER TREASURYS ASKING OFFICE SPREADS Markit CMBX 6 11/11 Earlier Avg. 07/20/00 48.9 61.8 AAA 98.1 98.2 98.0 190 07/27/00 50.2 65.0 10-year loans with 50-59% LTV AS 98.9 99.1 99.2 Month 180 08/03/00 52.4 67.6 11/6 Earlier AA 99.4 99.7 100.2 170 08/10/00 A 55.7 71.9 Office 172 175 A 98.6 99.0 100.2 160 BBB- 98.6 99.2 99.9 08/17/00 58.1 74.2 Retail 168 166 150 BB 98.1 98.8 99.7 Multi-family 165 161 08/24/00 58.4 74.9 140 Sources: Trepp, Markit 08/31/00 58.4 74.9 Industrial 168 166 130 09/07/00 58.6 75.1 Source: Trepp J F M A M J J A S O N AGENCY CMBS SPREADS 09/14/00 S 61.5 75.4 Spread (bp) FREDDIE K SERIES 09/21/00 69.4 79.2 Avg. SpreadWeek (bp) 52-wk REIT BOND ISSUANCE Life 11/12 Earlier Avg. Avg. Week 52-wk 09/28/00 71.0 80.8 A1 Life5.5 1S+591/12 EarlierS+59 Avg.39 10/05/00 71.3 82.9 UNSECURED NOTES, MTNs ($Bil.) MONTHLY ISSUANCE ($Bil.) AA12 10.05.5 S+59S+77 S+59S+75 3953 10/12/00 76.1 85.4 BA 2 10.0 S+340S+77 S+335S+75 18753 35 7 CB 10.0 S+340S+455 S+335S+450 187257 10/19/00 O 76.3 86.8 2014 6 30 X1C 10.09.0 S+455T+215 S+450T+215 257160 10/26/00 80.2 89.7 5 25 X3X1 10.09.0 T+215T+540 T+215T+540 160355 4 11/02/00 80.9 91.7 20 FreddieX3 K Floater 10.0 T+540L+65 T+540L+55 355 3 11/09/00 83.9 93.6 15 Freddie K Floater L+65 L+55 2 11/16/00 84.4 93.8 10 1 FANNIE DUS 11/23/00 N 85.9 5 2015 0 0 11/30/00 90.5 S O N D J F M A M J J A S O N Week 52-wk J F M A M J J A S O N D 11/12 EarlierWeek 52-Avg.wk 12/07/00 92.0 10/9.5 TBA (60-day settle) 1S+841/12 EarlierS+85 Avg.62 10/9.5 TBA (60-day settle) S+84 S+85 62 12/14/00 97.8 Data points for all charts can be found in The Marketplace section of CMAlert.com Fannie SARM L+57 L+57 Fannie SARM L+57 SourceL+57 : J.P. Morgan Source: J.P. Morgan

November 13, 2015 Commercial Mortgage 20 ALERT

erty types, including apartment and lending and structured finance. His THE GRAPEVINE office buildings. background includes stints at multi- ... From Page 1 family specialist Colony Hills Capital After three years in a buy-side role, of Wilbraham, Mass., Granite Loan the newly created position, reporting attorney Douglas Flaum joined law Management of Centennial, Colo., and to chief operating officerJoe Petro. firmNelson Mullins of Atlanta early New York-based Lexden Capital. From He’ll split his time between New last month. Flaum, of counsel, is part 2001 until 2008, he was a loan officer at York and the agency’s headquarters of the 23-member corporate real estate Arbor Commercial Mortgage of Union- in Horsham, Pa. Azam most recently group led by partner Bradley Denson. dale, N.Y. worked as an independent consultant. He’ll focus on debt and equity financ- He was a senior director at Fitch, ings, property sales, development, loan San Francisco-based Acore Capital where he worked from 2003 to foreclosures and workouts. Flaum most wants to add three staffers in Dallas — 2008 with a focus on CDO business recently was a managing director at an underwriter and two asset managers. development. He spent four years at the Atlanta headquarters of Turnstone Candidates need at least three years of Moody’s, leaving as a vice president in Group, where his duties included pur- experience. Applicants for the under- 1999. chasing and managing distressed debt, writer position should contact Chris as well as originating high-yield loans. Tokarski in San Francisco. The contact Linda Rhoads has moved from People’s Before joining that real estate invest- for the asset-manager openings is David United Bank to Northfield Bank. Rhoads ment firm in mid-2012, Flaum was an Homsher in Dallas. Acore is a bridge was a senior vice president at People’s associate at law firm McKenna Long for lender that began originating in August. United for about five years. She headed six years. up a commercial real estate team for the Ena Kunin has joined Credit Suisse’s Bridgeport, Conn., bank that focused Brooklyn mortgage brokerage Eastern commercial real estate group as a vice on Long Island commercial mortgages. Union Funding has hired industry vet- president on the underwriting and At Northfield, she runs a unit that cov- eran Peter Blass as a managing director. debt-valuation team. She arrived several ers New York City in addition to Long Blass started last week in the recently weeks ago after a year atGE Capital, Island. The Avenel, N.J., bank competes opened Manhattan office. He reports to where she worked on real estate valua- for nonrecourse financing assignments president Ira Zlotowitz. Blass is focus- tions. Before that, she spent eight-and- of up to $20 million on a range of prop- ing on agency and other multi-family a-half years at PricewaterhouseCoopers.

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