Sutherland closes on legacy $143.3m CMBS portfolio

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Sutherland Asset Management announced its completion of a $143.3 million securitization of pre-crisis commercial mortgage loans, according to a press release by the company.

Sutherland, a real estate investment trust specializing in small business commercial (SBC) loans, acquired the loans through several portfolio acquisitions. GE Capital, CNL Financial, PMC Property, and CIT Group originated or acquired the majority of the loans in the pool.

The loans have an average seasoning of approximately 12 years. The transaction pool includes loans to a variety of property types, including industrial, retail, multifamily, and other commercial properties.

“This transaction represents Sutherland's strong understanding of small business lending and continued dedication to the sector," said Thomas Capasse, Sutherland's chief executive officer. "Small business occupies 30% to 50% of all commercial space, so naturally, a transaction backed by commercial real estate is core to our strategy."

According to Capasse, Sutherland completed two securitizations of transitional and just a week prior to its Q2 earnings call on Aug. 3. These included a $139.4 million transaction of SBC owner-occupied loans as well as a $198.8 million deal backed by transitional, or bridge, loans. Sutherland also completed a securitization of Freddie Mac SBC multifamily property loans in the second quarter of this year.

In the past, Sutherland has also issued securitizations of SBC loans through its ReadyCap lending platform, according to press releases on its website. These include two 2015 transactions totaling $334 million.

Compared to the average seasoning of over 12 months in the latest Sutherland deal, its 2015 ReadyCap deals included a securitization of newly originated loans as well a securitization where over 85% of the loans had a seasoning greater than five months.

The ReadyCap securitizations received triple-A ratings from Moody’s Investors Service and S&P Global Ratings.

Sutherland originates SBC loans through its ReadyCap lending platform and originates residential mortgage loans through its GMFS Mortgage subsidiary. The company is externally managed and advised by Waterfall Asset Management.

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