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CREFW-Fall2014 10.15.14

Repeat Loans in CMBS A publication of Autumn issue 2014 sponsored by CRE Finance World Autumn 2014 53 Unlike the first example, Serrano Highlands, the Bay View Community MHC loan did not experience dramatic changes in its cost of capital. However it did experience large increases in leverage that grew at a 12% yoy rate at the first repeat, and a 4% yoy rate at the second repeat. The large increase in leverage was accompanied both times by a decrease in the loan cap rate. Despite reported LTV declines the asset is still operating with a debt yield that is well below the original securitization in 2003, marking a significant increase in credit risk. This loan had a cash-out at both its repeats. Case 3. 369 Lexington Avenue The 369 Lexington Avenue loan is secured by a Manhattan office building which was first securitized in 2004, and then repeated twice in 2006 and 2013. Figure 3 369 Lexington Avenue


CREFW-Fall2014 10.15.14
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