A pool of 705 small-balance commercial loans on 778 residential renal and commercial real estate (CRE) properties will secure the Velocity Commercial Capital Loan Trust's pending $295.1 million securitization.
The fixed-rate loans are divided into three sub-pools. The first contains 456 residential rental property investor loans. Those loans, which finance properties with up to four units, represent the bulk of the pool. Sub-pool two is composed of small-balance commercial real estate assets, 236 loans in all. The third sub-pool contains a series of 13 loans originated under the Small Business Administration's 504 program, according to the Kroll Bond Rating Agency. The rating agency noted that sub-pools 1, 2 and 3 relied on rating methods from the RMBS, CMBS and ABS sectors, respectively, KBRA said.
Overall, the have an average outstanding principal balance of $418,565, with balances ranging from $49,500 to $5.1 million, the rating agency said.
Barclays Capital, Performance Trust Capital Partners and Academy Securities are initial note purchasers on the deal, KBRA noted. The Asset Securitization Report's deal database notes that Barclays, Academy and SunTrust Robinson Humphrey Capital Markets are on the deal as managers, and an April 30 closing is expected.
The class A through M4 notes are pegged to the three-month Interpolated yield curve. Spreads are expected to range between 195 basis points on the AAA-rated notes to 610 basis points on the BB-rated notes.
Velocity Commercial Capital Loan's capital structure consists of classes A through M notes that will repay investors through a senior-subordinate structure, KBRA.
KBRA assigns an AAA to the a notes and AA+ through B+ on M1 through M5 notes.
