Can somebody explain to me how CMBS shops, conduit shops, and balance sheet lending differ as far as the work that is actually done. It seems to me that it should largely be similar analysis as far as analyzing the deal. Thanks!
Trending Content - Real Estate Forum
| +59 | Development Fees > Sponsor Equity Contribution | 18 | 8h |
| +57 | What's an Undergrad to Do? | 21 | 2d |
| +42 | Advice to Job Seekers: Don't Sleep on Asset Management | 13 | 1d |
| +24 | Mid Sized REPE firm for first job in RE | 9 | 9h |
| +10 | Full-Time RE Acquisitions Analyst Recruiting - Class of 2028 | 4 | 1d |
| +3 | Tishman Speyer Debt Fund | 0 | 4d |
| +3 | Debt fund jobs | 1 | 3d |
| +3 | Thoughts on CIM Group today? | 11 | 19h |
| +3 | LDG Development wins $36.3M Lawsuit | 0 | 4h |
| +1 | Equity Waterfall - Market Standard | 2 | 2d |
Career Resources
CMBS and conduit lending are the same thing, originating loans for securitization. Balance sheet lenders are typically life insurance companies and pension funds. Underwriting process is basically the same, main differences are in deal quality, leverage and loan structure (IO/amortizing, term, guarantees). Balance sheet deals are typically better quality assets in primary/strong secondary markets and have lower leverage (typically less than 65%). CMBS deals are often secondary/tertiary market retail, self-storage, limited service hospitality, etc. with higher leverage, sometimes with cash out, more IO, etc. The exception is very large single-asset or single-borrower transactions that can be very low-leverage with trophy assets. Commercial real estate underwriting analysis is basically the same across all loan types -- you're still diving into borrower/sponsor/guarantor details, market data, property level financials, rent roll, comp set, etc. to verify the deal makes sense.
From the groups within banks that I've looked into, it seems like a lot of the CMBS/conduit lending groups are under Corporate and Investment Banking whereas their balance sheet lending is under commercial banking.
Does this sound like an accurate picture of how they are typically organized?
Within CMBS groups, do the same people who make the loan also package it into the CMBS?
Numquam velit sequi et quis autem accusamus. Eligendi at eum accusamus aut velit. Est doloremque voluptas sit velit consequatur.
Dolores rerum voluptatem quae dolorem. Aut voluptatibus facilis et fuga modi dolore enim. Aut beatae quo et et maiores quisquam doloremque. Esse ea et rerum doloribus id quibusdam enim. Qui quidem asperiores dolor aspernatur nostrum dolore temporibus. Vel eum quia vel recusandae sit.
Tenetur voluptates libero est voluptas eos qui. Autem voluptatem quod cum assumenda voluptas id aut. Excepturi saepe in ut beatae.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...