Non-Recourse conduit financing that offers lower interest rates and higher Loan-to-Value.
CMBS LOANS OVERVIEW
We provide our clients unique access to real estate capital markets for the acquisition and refinance of commercial and multifamily properties. Our CMBS Conduit loan platform offers non-recourse permanent fixed rate financing and covers the entire debt stack. Cash-out refinance and interest-only options are also available. Achieve better returns by engaging Integra for your next transaction.
WHAT IS A CMBS LOAN?
CMBS Loans (“commercial mortgage backed security”), also known as a Conduit Loans, play an intricate role when it comes to commercial real estate financing. CMBS loans are secured by a first-position mortgage on a commercial property which in most cases is cash-flowing and stabilized.
HOW DO CONDUIT LOANS WORK?
After the loan is closed, the issuing conduit lender will look to package and sell the loan into a pool. This process is called securitization, whereby the loan is sold to investors and carries a specific rate of return. During the securitization, hundreds and at times thousands of similar loans varying in size, interest rate and property types are pooled together. CMBS investors have the ability to invest in various geographic location, property types and the credit rating, assessed by credit rating agencies. There are several different tranches from which investors choose to invest their capital. Each tranche represents a specific risk factor and rate of return for that associated risk.
CONDUIT FINANCING TODAY
CMBS loans have become a very popular source of capital for commercial real estate investors looking for higher leverage, 30-year amortization and a longer loan term than what most conventional banks can offer. Conduit lenders can also offer full-term interest only loans which are viewed as a critical advantage by some real estate investors looking for cash-flow.
CMBS interest rates are competitive and the loan is non-recourse, with standard “bad-boy” carve-outs. Interest rates are often fixed for 10-years, however, 5 and 7-year term loans are also available. CMBS loans often come with more stringent prepayment provisions such as Defeasance and/or Yield Maintenance to protect the guaranteed yield to bond investors.
Conduit lenders offer flexible underwriting guidelines, allowing novice commercial real estate investors to be financed creatively where a local savings bank may have been reluctant to lend. The vast majority of Conduit Loans are assumable, typically for a fee that was negotiated at loan document stage before closing. This mechanism allows the current owner to sell the property to a perspective buyer who subsequently assumes the ownership position and the terms of the existing loan.
CONDUIT LOAN PARAMETERS
Integra provides competitive fixed rate CMBS financing options for commercial real estate properties nationwide. By utilizing our commercial conduit loan platform, you can expect certainty of execution, competitive loan structures and a seamless closing process. Below are general loan parameters for a CMBS loan.
- Eligible Properties: Shopping Centers, Multifamily, Office, Hotel, Self Storage, Warehouse and Industrial.
- Locations: Primary, secondary and tertiary markets across U.S.
- Loan Term: 5, 7 and 10-year fixed rate terms (balloon at end of term), with longer maturities available.
- Amortization: Up to 30-Years, with Interest-Only options available on case-by-case basis.
- Guarantees: Non-Recourse to borrower, with standard carve-outs.
- Maximum LTV: Up to 80%
- Minimum DSCR: As low as 1.25x
- Early Rate Lock: Available
- Assumption: Loans are assumable with lender approval.
- Loan Size: $2 million minimum with no maximum.
- Prepayment: Defeasance or Yield Maintenance.
- Closing Process: Typically 30-45 days from the date of signed application.
CAPITAL MARKETS LOANS
Conduit Multifamily Loans
Conduit Shopping Center Loans
Conduit Office Building Loans
Conduit Hotel Loans
Conduit Self Storage Loans
Conduit Warehouse Loans
Conduit Light Industrial Loans
Conduit Mobile Home Park Loans
Debt & Equity Financing
Integra Real Estate Capital is a trusted adviser to private and institutional real estate investors across U.S. We secure competitive non-recourse CMBS loans for all property types in every market segment.
- Life Insurance Companies
- Commercial Banks
- Agency Lenders (Fannie Mae, Freddie Mac, HUD)
- Investment Banks
- Pension Funds
- Credit Unions
- Foreign Banks
- Private Equity
CMBS LOAN ADVANTAGES
- Higher Leverage (up to 80% LTV)
- Longer Amortization (30-Years)
- Non-Recourse (with carve-outs)
- Flexible Underwriting
- Interest Only Options
- Longer Term (5,7,10 Years)
- Competitive Interest Rates
- Allows Mezzanine Financing
- Available in secondary and tertiary markets
Integra Real Estate Capital maintains its unique relationships with core CMBS lenders. We assist clients in obtaining competitive conduit financing and negotiate aggressively on their behalf to achieve their financial goals and objectives. Speak to one of our professionals about your next project: (212) 353-2800