UPDATE:Developers Diversified Offers $400 Million Comml Mtge TALF
Deal
(Updates with analyst comment, more detail on deal, pricing)
By Anusha Shrivastava
Of DOW JONES NEWSWIRES
NEW YORK-(Dow Jones)- Property owner Developers Diversified Realty Corp. (DDR)
is in the market with a much-anticipated commercial mortgage-backed securities
deal.
The bond, dubbed 2009-DDR1, is eligible for financing under the Federal
Reserve's program to boost the commercial mortgage-backed market and is the
first newly created CMBS deal in more than a year.
"It's finally here," said Jim Harrington, a senior portfolio manager at Ryan
Labs Asset Management in New York. "There's no more mystery about it. This deal
will be used as a beacon and every other will be compared to it."
Earlier this month, the Cleveland, Ohio-based developer said it had closed on
a new first mortgage financing from an affiliate of Goldman Sachs Group Inc. (
GS). The five-year loan is secured by 28 shopping centers. The geographical
distribution is 19 states.
Because it is "100 percent retail," investors will think long and hard about
buying it, Harrington said.
Even so, market participants have been waiting eagerly for a CMBS deal so they
will give it "a good, hard look," he said.
Goldman Sachs is lead manager on the deal, which has three tranches. The
largest is a triple-A rated tranche worth $323.5 million, with a duration of
4.69 years.
The deal is being marketed in time for the next round of financing under the
Fed's Term Asset-Backed Securities Loan Facility, or TALF. The deadline for
cheap loans to buy new and existing CMBS is Nov. 17.
The deal is expected to be sold on Nov. 16, according to a term sheet.
-By Anusha Shrivastava, Dow Jones Newswires; 212-416-2227;
anusha.shrivastava@dowjones.com
(END) Dow Jones Newswires
11-09-091021ET
Copyright (c) 2009 Dow Jones & Company, Inc.
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