Conduit Loans Still The Best Option (Sometimes) and More Than Ever Not a Commodity

It is often hard being a conduit/CMBS lender or borrower. The immediate past has been one of the most frustrating periods for doing a CMBS 2.0 transaction. But, what’s past is not always prologue. 

We are finding that since the quickly-forgotten, ferocious race to the bottom on spreads, there still is excellent pricing and terms out there, and a realization of what it takes to close a deal based on a much better and realistic understanding of bond market expectations. In addition, a number of conduit lenders have the means to control the sizing and pricing of their B pieces or willingness  to warehouse A pieces, which are further tools to maintain spread.

We have also seen which CMBS lenders have performed the best despite recent pricing difficulties, and which are likely to continue that level of service and commitment.

Based on our familiarity with these lenders, our thinking is that this might be a very good time to refinance your deal in the CMBS market.

PS: There are a number of CMBS sponsored bridge to perm programs for those properties just shy of stabilization.