The CRED iQ research team focused upon the underwriting of the latest market transactions. We wanted to understand they key loan metrics across this universe to get a real-time sense of the new issues marketplace.
CRED iQ analyzed underwriting metrics for the latest 3 CMBS conduit transactions. We reviewed 158 properties associated with 101 new loans totaling $2.4 billion in loan originations. All of the loans originated within the past 4 months. Our analysis examined interest rates, loan-to-values (“LTV”), DSCR (NCF), debt yields, and cap rates. We further broke down these statistics to show a minimum, maximum and average for each metric and by property type.
The average interest rate across all loans and property types was 6.9%, average LTV was 59.2%, implied cap rates averaged 6.4% with debt yields averaging 11.7%.
Office
In total, 16 properties (of the 158 total in our analysis) were secured by office assets, comprising a total loan balance of $500 million. Average interest rates were 7.3%, average implied cap rates averaged 7.02% Debt yields and LTVs averaged 12.1% and 59.2, respectively.
Multifamily
There were 51 properties secured by multifamily properties totaling $980 million in new loan originations. Interest rates averaged of 6.70%. Cap rates averaged 6.00% for the multifamily sector. Average debt yields were 10.4% and LTVs averaged 62.5%, which was the highest for each of the sectors.
Retail
The retail component had a total of $345 million. In total, 18 properties were secured by retail properties. Interest rates average 6.87%. Cap rates averaged 6.16% for the retail sector. The average debt yield was 12.3%. Average LTVs were 57.3%.
Other Notable Findings
Hotels had the highest average interest rate (7.57%), cap rate (7.24%), and debt yield (12.7%) across the sectors.
Self Storage (3 properties, $27 million) and Manufactured housing (12 properties, $70 million) represented the smallest property types.
About CRED iQ
CRED iQ is a market data provider that offers a robust suite of data and software solutions tailored for commercial real estate and finance professionals.
With over $2.3 trillion of CRE loans, CRED iQ delivers instant access to a comprehensive range of financial data and analytics for millions of properties in every market. CRED iQ’s data and analytical capabilities are instrumental in helping investors, lenders and brokers make informed and strategic decisions critical to their business.
