Goldman Sachs and Citigroup have added another $961.5 million of securities backed by commercial mortgage loans to the new issue pipeline, according to a Kroll Bond Ratings presale report.
The conduit transaction, called GSMS 2014-GC22, is collateralized by 58 fixed rate commercial mortgage loans that are secured by 113 properties.
Retail and multifamily loans make up the largest portion of the pool balance nearly 50%. According to the KBRA presale report office properties account for 20.6% of the pool and mixed-use properties make up 12.3% of the pool.
The loans have principal balances ranging from $2.3 million to $110.0 million for the largest loan in the pool, Maine Mall (11.4%), a super-regional mall located in South Portland, Maine.
Most of the of the loans (22 loans, 64.0%) have interest-only periods, of which 18 (32.5%) are partial-term IO and four (31.5%) are full-term IO.
The transaction has higher leverage than the last 19 KBRA-rated CMBS conduits. The overall pool has a weighted average in-trust KLTV of 103.1%, compared to in-trust KLTVs ranging from 90.8% to 106.0% for past KBRA rated deals. There are 42 high leveraged loans (68.2%) in the pool with KLTVs that exceed 100%.
“Higher leverage implies lower borrower equity levels, greater default probability, and higher overall loss severity should a default occur,” explained KBRA.
All of the loans were contributed by four mortgage loan sellers, Citigroup Global Markets Realty Corp., Goldman Sachs Mortgage Company,Cantor Commercial Real Estate Lending and Starwood Mortgage Funding I.
The chart below shows how the deal is tranche and rated by KBRA.