The bankruptcy filing by Sears will likely place additional stress on commercial MBS backed by the retailer, but the effect in most deals could be minimal and, in the long term, even positive for the commercial properties, said rating agencies.
The new single security is on track for its June 3, 2019, launch and trading is expected to begin around March, according to Fannie Mae and Freddie Mac executives speaking at the Mortgage Bankers Association’s annual conference in Washington last week.
Issuance of single-family rental securities this year is on track to be 60.0 percent higher than issuance in 2017, according to analysts at Bank of America Merrill Lynch. The sector has been helped by ongoing demand for rental properties and strong performance.
Issuance of collateralized debt obligations holding trust preferred securities has resumed in recent years after performance issues related to the financial crisis. Investors report strong demand for TruPS CDOs and suggest that banks should issue more of the deals.