Fortune Real Estate Investment Trust, the Singapore-listed vehicle that invests in Hong Kong property, closed its HK$2.39 billion ($306.8 million) debut CMBS offering via the Triumph Assets SPV last week. HSBC Securities arranged the deal - collateralized by a secured loan held over 11 retail properties owned by Fortune - with DBS Bank as joint lead manager.
The notes have an expected maturity of five years and a 6.5-year legal final and should the notes not fully amortize in five years, a step-up feature is triggered. All three tranches priced at the mid-point of the marketed range. The HK$1.74 billion senior piece, rated AAA' by both Fitch Ratings and Standard & Poor's, pays a 25 basis point spread over Hibor; the HK$360 million double-A rated tranche pays 45 basis points over and the HK$290 million single-A rated notes carry a 60 basis point spread to Hibor, respectively. Should the five-year step-up trigger be activated, spreads to Hibor double for all three tranches.