New York-based investment group Greystone is sponsoring a $600 million CRE CLO, its third such transaction pooling bridge loans made for multifamily housing development.
Greystone 2019-FL2 will involve 18 whole loans primarily for multifamily developments. The in-trust balance of the portfolio is $464.2 million and $135.8 million in cash collateral that will be used to purchase additional loans for the deal.
The additional collateral will include three pre-identified loans totaling $27.8 million, some pari passu participations to loans already included in the deal, and some unidentified whole loans and senior participations, according to Kroll Bond Rating Agency.
The proceeds from the loans were for property acquisitions and refinancing existing debt.
The fully managed CRE CLO will include a three-year reinvestment period, including an initial six-month ramp-up period.
The transaction will offer seven classes of notes, including a senior structure consisting of a $336.75 million Class A tranche with a preliminary AAA rating from Kroll.
All of the loans were originated by Greystone, an investment group based in New York that originated multifamily and health care facility loans for Fannie Mae, Freddie Mac, the FHA and various commercial mortgage-backed securities. Part of its lending platform is a bridge loan program that has operated since 2004. The company has originated $4.4 billion in bridge loans at the time; bridge loans make up 4.2% of Greystone’s outstanding originations.
Greystone will transfer more than 76% of the collateral from a 2017 vintage CRE CLO into the new Greystone 2019-FL2 vehicle, with the Greystone 2017-FL1 deal expected to be fully redeemed. None of the loans being transferred with impaired.
Wells Fargo structured the deal, and worked with JPMorgan and UBS on placement with lenders.
