Hot on the heels of C-BASS' collateralized debt obligation, GMAC Commercial Mortgage Corp. has stepped up to the plate, assembling its own CDO backed by commercial mortgage-backed securities.
GMAC is partnering with Goffmoore Strategic Partners, both cofounders of the G2 Opportunity Fund, which is originating the collateral. The $862 million CDO, called G-Force, is backed by 79 subordinate CMBS certificates from 21 separate deals.
Morgan Stanley Dean Witter is lead manager on the transaction.
Only the investment grade tranches are being offered, which tally to roughly $408 million. The remaining Class F, Class G, and the preferred equity are being privately placed.
The transaction has a heavy concentration of subordinate non-investment grade rated tranches hovering in the B/B- (Fitch) area. There will be an amortizing swap, since the collateral securities are fixed-rate.
Other deals current
Goldman Sachs is premarketing a $500 million collareralized debt obligation backed by leveraged loans for Fleet Boston Financial.
Talk on the seven-year $380 million A-class is Libor plus 48 area. The deal also includes three mezzanine and subordinate classes (B through D) plus an unrated equity piece.
The collateral, consisting of 95% high-yield loans and up to 5% bonds, has a diversity score of 40 and an average rating of B1 (Moody's).
Goldman is also the lead on Centurion CDO III, a $250 million CBO backed by high-yield bonds, synthetic securities, and ABS.
American Express Asset Management is collateral manager on the deal, which was originally launched in December, market sources said. The equity tranche has a projected 20%-25% annual yield, based on a 2% annual gross default rate assumption.
Also, Salomon Smith Barney is said to be prepping a CBO for 30-40 small banks using its trust-preferred structure (Trups). The CBO, that gathers assets from a group of small community banks, will have a static pool and no secondary issues.
The structure gives the small banks capital market access at a fraction of the normal arranging fees and legal costs (see Observation page 16)