Commercial/Multifamily Briefs Sept. 17, 2020

Exantas Capital Corp. Prices $297M CLO Backed by Commercial Mortgage Loans

Exantas Capital Corp., New York, announced its newly formed subsidiaries, Exantas Capital Corp. 2020-RSO9 Ltd. and Exantas Capital Corp. 2020-RSO9 LLC will issue $245.8 million of non-recourse, floating-rate notes at a weighted-average cost of the one-month LIBOR plus 313 basis points.

Exantas President and CEO Mark Fogel called the successful issuance of these notes “a positive indicator of a market that is starting to stabilize.”

The offered notes include:

•             $158.9 million of Class A Notes, which were rated Aaa(sf) by Moody’s Investors Service, Inc., and AAA(sf) by DBRS, Inc. and will be issued at a coupon of LIBOR+250 basis points; 

•             $26.7 million of Class A-S Notes, which were rated AAA(sf) by DBRS Morningstar and will be issued at a coupon of LIBOR+350 basis points; 

•             $16.7 million of Class B Notes, which were rated AA(low)(sf) by DBRS Morningstar and will be issued at a coupon of LIBOR+390 basis points; 

•             $20.8 million of Class C Notes, which were rated A(low)(sf) by DBRS Morningstar and will be issued at a coupon of LIBOR+425 basis points; and 

•             $22.7 million of Class D Notes, which were rated BBB(low)(sf) by DBRS Morningstar and will be issued at a coupon of LIBOR+500 basis points.

The firm expects the transaction to close by September 30, 2020. The offered notes are collateralized by floating-rate commercial real estate first mortgage loans originated or acquired by the company with an aggregate outstanding principal balance of approximately $275.4 million and an aggregate committed principal balance of approximately $297.0 million. The company will retain the Class E and Class F subordinated notes and the preferred shares in the transaction.

Freddie Mac Prices $929M Multifamily K-Deal
Freddie Mac, McLean, Va., priced a new offering of Structured Pass-Through K Certificates that includes a class of floating-rate bonds indexed to the Secured Overnight Financing Rate (SOFR).

The nearly $929 million in K Certificates (K-F84 Certificates) should settle on or about September 18, 2020. The K-F84 Certificates are backed by floating-rate multifamily mortgages with 10-year terms, which are currently LIBOR-based.

K-F84 includes one class (Class AL) of senior bonds indexed to LIBOR and another class (Class AS) of senior bonds indexed to SOFR. Freddie Mac will provide a basis risk guarantee on Class AS that covers any floating interest rate basis risk if the value of SOFR exceeds the value of LIBOR.

Goldman Sachs & Co. LLC and Citigroup Global Markets Inc. served as Co-Lead Managers and Joint Bookrunners. CastleOak Securities L.P., J.P. Morgan Securities LLC, Oppenheimer & Co. Inc. and PNC Capital Markets LLC co-managed the process.

JCR Capital Rebrands as Walker & Dunlop Investment Partners

Walker & Dunlop, announced that two years after acquiring alternative investment manager JCR Capital Investment Corporation, the firm will be rebranded as Walker & Dunlop Investment Partners Inc.

Sam Isaacson, who previously served as Managing Director leading the firm’s investment teams, has been promoted to President and will lead WDIP’s daily operations.

Jay Rollins, Co-Founder of JCR and former Managing Partner and President, was named Chairman of the Board of WDIP. He and Co-Founder Maren Steinberg will continue to serve on WDIP’s Board of Directors, participate on all fund investment committees, provide strategic guidance to the organization and manage the existing JCR-branded funds, including JCR Funds III, IV and V.  During Isaacson’s tenure as Managing Director and Lead Portfolio Manager, he has been responsible for managing JCR’s capital deployment and underwriting for three equity and debt vehicles totaling approximately $600 million in real estate investments. Rollins, Steinberg and Isaacson will all continue to be based in Walker & Dunlop’s Denver office, along with CEO Willy Walker.