Goldman Sachs and Citigroup’s CMBS conduit GSMS 2014-GC18, priced wide of guidance issued on Tuesday.
The 10-year, super senior notes are being priced three basis points wide of guidance at 90 basis points over swaps.
Further down the credit curve, the double-A rated, class B notes structured with a weighted average life of 9.94-years priced five basis points wide at 170 basis points over swaps; the single-A minus, class C notes also widened by five basis points and priced at 215 basis points over swaps.
The deal is backed by 74 commercial mortgage loans that are secured by 141 properties. Fitch noted in its presale report that the pool’s debt service coverage ratio and LTV of 1.15x and 106.2%, respectively, are worse than the averages for the sector in 2013 (1.29x and 101.6%) and 2012 (1.24x and 97.2%).
Two of the five largest loans, The Crossroads (9% of the pool) and Wyoming Valley Mall (7%), are collateralized by regional malls located in secondary markets. Retail properties represent the largest property type concentration at 40.5% of the pool, including five of the top 10 loans. This is higher than the 2013 average retail concentration of 33.2%.
However the pool’s hotel concentration of 8.1% is lower than the 2013 average hotel concentration of 14.7%. Two of the 15 largest loans in the pool are collateralized by hotel properties. Hotels have a higher probability of default in Fitch’s multiborrower model.