Arbor Realty Trust, Inc. Closes a $2.10 Billion Collateralized Loan Obligation Securitization
December 13, 2021 at 04:10 pm EST
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Arbor Realty Trust, Inc. announced the closing of a $2.10 billion commercial real estate mortgage loan securitization (the Securitization). An aggregate of approximately $1.71 billion of investment grade-rated notes were issued and Arbor retained subordinate interests in the issuing vehicle of approximately $386 million. The $2.10 billion of collateral includes approximately $315 million of capacity to acquire additional loans for a period of up to 180 days from the closing date of the Securitization. The Notes have an initial weighted average spread of 1.68% over one-month LIBOR, excluding fees and transaction costs. The facility has an approximate two-and-a-half-year replenishment period that allows the principal proceeds from repayments of the portfolio assets to be reinvested in qualifying replacement assets, subject to certain conditions. The offering of the investment grade-rated Notes was made pursuant to a private placement. The investment grade-rated Notes were issued under an indenture and secured initially by a portfolio of real estate related assets and cash with a face value of $2.10 billion, with such real estate related assets consisting primarily of first mortgage bridge loans. Arbor intends to own the portfolio of real estate related assets through the vehicle until its maturity and expects to account for the Securitization on its balance sheet as a financing. Arbor will use the proceeds of this Securitization to repay borrowings under its current credit facilities, pay transaction expenses and to fund future loans and investments.
Arbor Realty Trust, Inc. is a real estate investment trust. The Companyâs segments include Structured Business and Agency Business. Through its Structured Business, it invests in a diversified portfolio of structured finance assets in the multifamily, single-family rental (SFR) and commercial real estate markets, primarily consisting of bridge loans, in addition to mezzanine loans, junior participating interests in first mortgages and preferred and direct equity. It also invests in real estate-related joint ventures and may directly acquire real property and invest in real estate-related notes and certain mortgage-related securities. Through its Agency Business, the Company originates, sells, and services a range of multifamily finance products through Fannie Mae and Freddie Mac, Ginnie Mae, Federal Housing Authority (FHA), and Housing and Urban Development (HUD). It originates, sells, and services a range of multifamily finance products.