Securitization

The percentage of larger loans in HGVT-2 is 20.08%, S&P said. While that is lower than the 23.2% seen in the previous deal, it is still too high.

Most of the pool, 68.6%, is in the repayment phase, while 19.1% of the loans in the pool are in deferment.

Apollo bundled assets plucked from its own funds, including real-estate debt, into a Bermuda-based vehicle, and sold bonds against it with investment-grade ratings and unusually long lifespans.

One tenant accounts for 59.7% of the leased capacity and 56.4% of annualized adjusted base rent, but also has a AAA rating.

Last year the Fed cut its benchmark rate by 50 basis points in September, and went on to lower rates twice more, even as 10-year Treasury yields rose.

The proposed injection would be structured as a first-out, first-lien bond. The incremental debt would carry a 10.5% coupon with a 2031 maturity.

The entire pool was originated using agency underwriting, with PennyMac being the largest originator, and accounting for 66.1% of the mortgage loans.

Data centers across 20 markets will provide the revenues to support the notes. Also, the largest customer accounts for 6.5% of annualized monthly recurring revenue (AMRR).

Domino's also raised $320 million through a variable funding note facility, not offered to investors. Barclays Plc is leading the transaction, joined by Guggenheim Securities LLC.

There is no amortization during the entire term, and interest-only payments are based on the one-month Secured Overnight Financing Rate (SOFR), plus a spread of about 3.74%.