JER Investors Prices CDO

JER Investors Trust Inc., McLean, Va., has priced $416 million (par value) of collateralized debt obligations to be issued by two subsidiaries of the company.JER Investors, a real estate investment trust that originates and acquires commercial real estate structured finance products, said the two issuing subsidiaries are JER CRE CDO 2005-1 Ltd. and JER CRE CDO 2005-1 LLC. The CDO will issue privately placed notes totaling $276 million, and the company said it will initially retain a portion of the BBB-minus rated notes, all the non-investment-grade notes, and all the preferred shares. The CDO also includes a ramp facility that will finance up to $46 million (par value) of additional collateral securities. The company said the weighted average cost of borrowing for the investment-grade bonds is about 83 basis points over applicable swap rates and the London interbank offered rate.