JPMorgan Chase & Co. is marketing $484.6 million of bonds backed by a loan to Centro Properties Group, the Australian shopping center owner seeking to refinance $2.7 billion of debt from its U.S. business.
The loan is secured by 72 retail properties owned by the Glen Waverley, Australia-based company, according to people familiar with offering who declined to be identified because terms are private. Shopping centers in Texas account for 39 percent of the pool, while properties in New York and New Jersey represent 21 percent.
The transaction is the sixth sale of commercial mortgage- backed securities this year as Wall Street seeks to revive sales after issuance plummeted 95 percent to $11.2 billion in 2008 from a record $234 billion in 2007, according to data compiled by Bloomberg. The most recent offering, also tied to a single loan, was a $660 million deal for Vornado Realty Trust earlier this month.
Of commercial-mortgage bond sales in 2010, three have been linked to the properties of a single borrower. Offerings grew to be as large as $7.6 billion and bundled as many as 300 loans from borrowers across the U.S. as sales peaked in 2007, Bloomberg data show.
Wall Street banks have been writing new loans to pool for so-called multi-borrower offerings, though many property owners are unable to pay off the existing mortgage amid tighter underwriting standards and prices down 41 percent from 2007 peaks, according to Moody’s Investors Service.
The Moody’s/REAL Commercial Property Price Index dropped 4 percent in June, the company said today in a report. The decline was the biggest since July 2009.
JPMorgan is preparing a $1 billion deal for September, people familiar with that sale said. The offering, the largest this year, will be made up of about 38 loans to different property owners.