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Wells Fargo Conduit Third CMBS to Price in May

Wells Fargo priced $1.076 billion of commercial mortgage backed securities via Wells Fargo Commercial Mortgage Trust 2015-C28.

The  benchmark, 10-year, senior notes pay swaps plus 87 basis points, according to a pricing document. By comparison Credit Suisse priced comparable notes from its C-SAIL 2015-C2 transaction last week at swaps plus 86 basis points. 

Bothc onduits publicly registered the triple-B rated securities, which are the most junior notes in a CMBS structure. Since the financial crisis, only the senior notes of most CMBS have been publicly offered; the junior, or B piece, notes are typically privately placed. A private offering allows sponsors to share additional information about the collateral with B piece investors, who take the first losses when loans go bad. However this limits the pool of potential investors. By offering the notes publicly, sponsors hope to market them more widely.

Wells Fargo is paying swaps plus 355 basis points on the triple-B, 10-year notes. The notes benefit from 7.625% credit enhancement.

By comparison, Credit Suisse paid swaps plus 330 basis points for the BBB-, 10-year, B piece notes from its C-SAIL conduit. Although the  notes are structured with sligthly less credit support at 7.5%, the pool benefits from a lower weighted average loan to value of 66.2% compared to 67.5% for the Wells Fargo pool.  

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