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Commercial real estate CLO market grows; NorthStar plans $613 million real estate CLO deal
By Cristal Cody
Tupelo, Miss., Dec. 8 – The commercial real estate CLO market is showing signs of life with another deal in the pipeline before the year ends.
NorthStar Realty Finance Corp. is organizing a $612,978,000 CRE CLO offering.
In October, commercial real estate lender Hunt Mortgage Group announced that it plans to build a CLO platform and start issuing commercial real estate CLOs.
In August, Resource Capital Corp. priced the $312,937,000 static CRE CLO transaction, Resource Capital Corp. 2015-CRE4, Ltd.
NorthStar to price CLO
NorthStar Realty Finance intends to price a $612,978,000 CRE CLO transaction via Deutsche Bank Securities, Inc. and Citigroup Global Markets Inc., according to a market source.
The NorthStar 2015-1/NorthStar 2015-1, LLC deal includes $319.51 million of class A floating-rate notes (Kroll: AAA); $29.88 million of class B floating-rate notes; $39.4 million of class C deferrable floating-rate notes; $39.4 million of class D deferrable floating-rate notes; $27.58 million of class E deferrable floating-rate notes; $30.64 million of class F deferrable floating-rate notes; $27.58 million of class G deferrable floating-rate notes and $98,108,000 of preferred shares.
The class F notes, class G notes and preferred shares will be purchased by NS Income II Holder 2015-1, LLC, an affiliate of the trust asset sellers, on the closing date.
NS Income II Administration Agent, LLC will act as administration agent.
The notes mature at par in May 2036 unless redeemed or repaid earlier.
The CLO is collateralized by 20 non-recourse loan interests consisting of whole loans and senior or pari-passu funded participations in whole loans originated between September 2013 and September 2015 by affiliates of NorthStar Asset Management Group and secured by the fee simple interests in 81 properties in 11 states.
NorthStar Realty Finance is a New York-based real estate investment trust that is managed by NorthStar Asset Management Group.
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