Deutsche Bank is preparing a $750 million single loan commercial mortgage-backed securitization, according to a presale report published by Kroll Bond Rating Agency.
The loan has a 10-year term and a fixed-rate coupon of 3.62%.
The loan is secured by the fee interest on 277 Park Avenue, a 1.8 million square foot, 51-story office building located in Midtown, Manhattan, which is currently the largest business district in the US. The property has maintained a 97.6% occupancy rate over the last six years and was 98.0% leased as of July 2014, which Kroll views as strength for the transaction.
However, the loan is interest-only, meaning that it will not deleverage over its 10-year term due to the absence of amortization.
Proceeds from $750 million COMM 2014-277P will be used to retire $700 million of existing debt, pay $37.8 million of prepayment costs, fund reserves, and pay closing costs.
Kroll assigned a provisional AAA’ rating to the $570 million class A notes with a final distribution date in August 2049. The $84 million class B notes were provisionally rated AA.’
