DBRS said it plans to rate the $103 million conduit CMBS issued by A10 Capital, a commercial real estate lender that specializes in small to middle market commercial mortgage loans.

The deal, A10 Securitization 2013-1, will offer investors $97 million of notes over four tranches that have not yet been assigned ratings, according to the DBRS pre-sale. A10 Capital will hold the first-loss piece of the deal for as long as the bonds remain outstanding.

The pool consists of 16 floating-rate loans and five fixed-rate loans secured by 24 commercial properties.

A10 Capital serves a segment of the commercial mortgage market largely underserved by community banks because of their overexposure to commercial real estate, said DBRS in the presale report. The lender specializes in short-term loans, which typically have two- to-five-year terms and are used to finance properties until they are fully stabilized.  

The borrowers are typically new equity sponsors of fairly well positioned assets within their respective markets. Most loans are structured with three-year terms and include built-in extensions at the lender’s sole discretion.

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