The new $876 million conduit CMBS from Deutsche Bank/Cantor Fitzgerald will raise year-to-date issuance in the sector to $32 billion, which is $1 billion less than 2011’s full year total, according to today's Standard & Poor's securitization update.
The conduit called COMM 2012-CCRE3 is set to price next week, according to a Bloomberg report. Also in line to price this week is the $1 billion conduit deal from JPMorgan called JPMCC 2012-C7.
A Sept. 25 Morningstar report on the CMBS sector estimated that around $8 billion in CMBS has come to market in September, with another $5.7 billion priced. The rating agency said that total issuance volume, which includes both public and agency bonds, stands at roughly $45.3 billion in 3Q12.
Bank Of America Merrill Lynch analysts in a Sept. 21, report estimated that conduit issuance would top $6 billion in September, which translates to full-year conduit gross issuance of approximately $28 billion to $30 billion.
This step-up in issuance has come with steadily compressing spreads. On the back of this trend, the BofA Merrill analysts said that conduit lenders may now be able to offer borrowers coupons in the 4% range, which will allow them to compete more effectively with life insurance companies for loans.
"As a result, we expect 2013 gross conduit issuance will total roughly $40 billion while single-asset/single-borrower gross issuance could total about $10 billion next year," analysts said.