While CMBS production was robust in the first six months of 1999, it was "down by almost 50% during the last six months," said Greg Jacobs, senior vice president and co-head at Greenwich Capital Markets, Inc.

Mid-April showed the tightest spreads for the sector, between 100 and 105 basis points, but then a significant widening took place during the fall due to a lack of liquidity. Despite Y2K, November and December showed more investor interest, and spreads collapsed in December, tightening on the expectations of an increase in interest rates in February.

Subscribe Now

Access to a full range of industry content, analysis and expert commentary.

30-Day Free Trial

No credit card required. Access coverage of the securitization marketplace, including breaking news updated throughout the day.