Donna M. Mitchell

The deal will repay investors on a hyrid pro rata, sequential basis. Credit enhancement ranges from 51.7% on the class A1A notes to the 2.25% on the class B2 notes.

This is the first RTL transaction for Roc360 Real Estate Income Trust, the deal's sponsor, in three years. Also, it is Roc360's first rated RTL transaction.

Underlying borrowers have accumulated significant amount of home equity in their homes, to a weighted average (WA) original cumulative loan-to-value (CLTV) ratio of 69.5%.

In the non-prime pool, owner-occupied properties account for most of the assets, at 55.1%; the amount of investor properties represents 41.6% of the deal.

A trigger occurs if the reserve fund is less than 50% of the reserve fund target amount, or if the payment date where the outstanding HEA valuation is less than 80% of the starting home valuation.

Pricing talk includes yields ranging from 4.9% on the AAA, class A1 notes; 5.7% on the AA, class A2 notes; and 6.2% on the AA M1 notes.

Yields are expected to range from 5.75% on the A1A notes to 6.55% on the M1, all priced on the three-month, interpolated yield curve.

Professionals also must grapple with the issue of wanting liquidity on assets in an era of low production.

Dean Wheeler will drive the firm's growth push in the U.S. and follows the London firm promoting Serenity Morley to COO, to drive growth globally.

The mortgages have an average balance of $70,312, and an average coupon, on a weighted average (WA) basis, of 10.06%. Also on a WA basis, the borrowers have an original credit score of 739.

The coupons on the class A notes steps up after four years by 100 basis points, but the coupons are subject to a net weighted average coupon (WAC) cap.

The sponsor sourced the mortgage collateral from a range of originators, but none of them accounts for more than 10% of the pool balance.

Retail properties account for 44.1% of the pool, the collateral pool's largest portion. Multifamily, lodging office and other properties account for 12.5%, 11.5%, 8.9% and 23.0%, respectively.

Home equity investment (HEI) agreements homeowners receive upfront cash payments in exchange for giving an investor a stake in the property and the right to collect returns.

Compared with other tax lien transactions, PVOne 2023-1 has a much smaller initial redemption value, and has one of the lowest numbers of liens, at 9,681. Its weighted average loan-to-value (LTV) ratio is 8.8%.

A vast majority of the pool, 86.35%, consists of primary homes. Investment properties and secondary homes, meanwhile, account for 11.29% and 2.36% of the collateral.

The properties have a purchase price of $684.8 million, and an issuer cost basis of $744.4 million, a debt yield of 7.0%, and a debt service coverage ratio of 1.44x.

Notes will be repaid through a modified sequential structure, which calls for the A-1 and M-1 through M-3 classes to receive principal on a pro-rata basis.

Among the nonperforming assets 44.01% are either in foreclosure or referred for foreclosure; 19.32% are in default; 7.17% are liquidated and 1.75% are in bankruptcy.

The investor segment will have to be mindful as it gains ground, executives said Tuesday, noting that the sector takes experience, skill and savvy awareness of risks.