Fortress prices $598.7 million CDO; Hunt Mortgage Group to issue real estate CLOs

By Cristal Cody

Tupelo, Miss., Oct. 28 – Fortress Investment Group LLC, which priced a $425.4 million broadly syndicated CLO deal in late September, brought to market a $598.7 million CDO transaction.

The deal included four tranches of fixed-rate notes.

In other market activity, commercial real estate lender Hunt Mortgage Group announced that it plans to begin issuing commercial real estate CLOs.

The company said in a release that it hired Amy Shah as vice president on its proprietary lending team to launch and build a CLO platform.

“In addition to establishing a CLO program for Hunt Mortgage Group, Amy will also focus heavily on placing bridge loans and will work to help expand the balance-sheet lending program,” Michael Becktel, director of Hunt Mortgage Group, said in the release.

“Our non-agency lending business, known as the proprietary lending group, has closed or committed more than $450 million in loans so far in 2015. We plan to grow that business and begin issuing commercial real estate CLOs as part of our long-range securitization plans.”

Prior to joining Hunt Mortgage Group, Shah structured, priced, securitized and managed several CRE CLO transactions with Resource Real Estate Inc. as a vice president in their CRE capital markets division.

New York City-based Hunt Mortgage Group is a subsidiary of Hunt Cos., Inc.

Fortress prices $598.7 million

Fortress Investment Group sold $598.7 million of notes due Nov. 12, 2030 in the cash flow CDO transaction, according to a market source.

At the top of the capital stack, FDF I Ltd. priced $290.5 million of 4.4% class A senior secured fixed-rate notes.

GreensLedge Capital Markets LLC arranged the transaction.

The CDO manager is FDF I CM LLC.

The CDO has a non-call period that ends Nov. 12, 2017. The reinvestment period ends Nov. 12, 2020.

The deal is backed by a $600 million corporate bond and loan portfolio. Up to 65% of the portfolio may consist of second lien loans, unsecured loans, bonds, subordinated bonds or unsecured bonds.

Fortress Investment has tapped the market over the year to also price three CLO transactions and refinance two vintage 2012 CLO deals.

The New York City-based investment firm brought to market two CLO deals in 2014.

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