HYPO Public Finance Bank earlier this month closed the first

synthetic CDO that derives credit enhancement solely from reference obligations, according to several sources. The $3 billion Pegasus 2006-1 came to market via two triple-A rated tranches referencing U.S. CMBS assets. The deal consisted of repackaged triple-A rated U.S. CMBS bonds - but what made it different from other transactions was the lack of subordination beneath the deal's triple-A tranches, according to one market source. Instead, subordination was derived from each individual reference obligation; 20% of the notional would need to erode before note holders incurred any losses. HYPO is likely to manage another such deal backed by different collateral, sources said.

Standard Bank has hired Nick Hamilton as chief executive officer for the Asia Pacific region. Hamilton also held the same position at HVB/UniCredit Group. While at HVB, Hamilton focused on structured finance and securitization, distressed assets and credit products, which covered all the main Asian markets. The new hire is based in Singapore.

Standard & Poor's has named managing director Karen Naylor as head of European covered bonds, replacing Torsten Althaus, who has left the agency. The new appointee joined the rating agency in 1994, and was previously the head of European RMBS. Naylor will report to Ian Bell, S&P's managing director of European structured finance.

Marci Schmerler has joined the law firm of Thompson Hine LLP as a partner in the firm's real estate practice group. Schmerler will head up the firm's real estate practice in Atlanta. Before joining Thompson Hine, Schmerler was a partner with Alston & Bird LLP. Schmerler focuses her practice on secured financing of multistate CRE projects for life companies, banks and conduit lenders for securitization. She has experience with acquisitions and sales of commercial real estate projects for REITs, life companies, pension funds, real estate advisors and other institutional and entrepreneurial investors. She focuses on complex joint venture and project finance transactions as well. Schmerler also handles acquisition, sale, development and financing transactions involving owned and leased real estate for non-real estate companies. Tom Coyne, Thompson Hine's national real estate practice group leader, stated, "We are excited to have Marci join our team. She will help lead our real estate capital markets practice serving institutional and conduit lenders and investors, REITs, investment banks, real estate funds and advisors." Walt Linscott, partner-in-charge of the Atlanta office added, "Our Atlanta office is growing rapidly and we're pleased to have lawyers of Marci's caliber join us. We welcome her to the firm and to the Atlanta office."

The Commerce Department reported last Wednesday that housing starts fell by roughly 3% in July, to an annualized rate of 1.795 million units. This is the fifth drop in the last six months as well as the weakest reading since Nov. 2004. Except for a minor 1% rise in the Midwest, starts were down in all regions in July. The Northeast (-7.0%) failed to bounce back in July from a weather-induced dip in June, while the South (-2.5%) and West (-2.9%) both dropped for the second consecutive month. Single-family starts posted a 2.3% drop in July, while multifamily starts fell by 3.4%, as the softness was evident in both housing sectors. Meanwhile, building permits noticeably decreased by 7% in July, falling to the lowest level in four years. Both single-family (-6.1%) and multifamily (-7.7%) permits showed remarkable drops, and permits were down significantly in all regions.

Fitch Ratings reported last week that CMBS delinquencies dipped six basis points in July, to 0.59% down from 0.65% a month earlier. Half of the six-basis-point delinquency rate decline was caused by the addition of seven new transactions totaling $15.2 billion to Fitch's deal universe. The other half of the dip is a result of loans becoming less than 60-days delinquent, being paid off, defeased, or liquidated and therefore dropping out of the delinquent universe, the rating agency said. The seasoned delinquency index, which omits deals with less than a year of seasoning, decreased five basis points this month to 0.77%. The seasoned index is also affected by the addition of deals as they age. This month two newly seasoned deals accounted for 20% of the drop, Fitch said.

CharterMac last week announced that it has completed the acquisition of ARCap Investors, which is a fund manager specializing in the acquisition, management and servicing of high-yield CMBS and high-yield direct real estate loans. Irving, Texas-based ARCap manages a portfolio of over $2 billion of CMBS for its institutional clients and for its own account.

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