GMAC Commercial Holding Capital Markets Corp. is planning a unique revolving structure CDO, expected to hit the market sometime this week, sources said. The $370 million transaction, named Capital Trust, will be backed by previously issued B piece and mezzanine tranches of CMBS retained or purchased by GMAC Commercial Mortgage, which it will be able to rotate in and out of the trust.

Morgan Stanley and RFC Securities will underwrite the offering, although it is unclear what each entity's role will be. REIT Capital Trust is the equity holder on the CDO and can add assets to the trust. It is believed that this transaction will be sold directly into a conduit facility, thereby acting as a quasi line of credit for GMACCM.

"GMAC had planned to sell GMACCM, but then changed their minds, and GMAC wanted to find a more economical way for GMACCM to finance its commercial loans," a rating agency source said. "Other GMAC units have financed via conduits and they would like to finance commercial loans that way, too."

Collateral backing the underlying assets in the deal were described as "a continually rotating diverse pool of B-tranche CMBS backed by a diverse array of sectors," said one source close to the situation.

The motivation for GMAC is parent company General Motors Acceptance Corp.'s concerns over its commercial lending units' exposure. This vehicle will allow GMAC Commercial Mortgage to retain or purchase subordinated CMBS classes it issues and re-issue bonds from the Capital Trust, as needed.

The capital structure will be fairly standard, the source added, with three floating-rate classes, average lives ranging between five and seven years. Capital Trust will be rated by Fitch Ratings, Moody's Investors Service and Standard & Poor's.

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