Hypo Real Estate Bank International, Stuttgart, closed its securitisation transaction ESTATE US-1. This transaction initiates the banks securitisation program ESTATE that it will continuously use in different structural formats. The program ESTATE will place CMBS of different countries, property types and risk profiles into global capital markets.
ESTATE US-1 is a synthetic CMBS that contains three loans on prime office buildings in Manhattan and Washington, D.C. The risk of this portfolio was sold into the global capital markets using several classes of Credit Default Swaps (CDS) and Credit Linked Notes (CLN). The transaction was rated by Standard & Poors and Fitch with ratings from AAA to A. The very high quality of the loans becomes transparent as the AAA piece equals 89.2% of the portfolio and the first loss tranche of ESTATE US-1 has a rating of A from both rating agencies.
The transaction was structured, arranged and lead managed by the securitisation team in Stuttgart. Hypo Real Estate Bank International plans to have securitisation teams in London and New York who also contribute to the program ESTATE.
Source: Hypo Real Estate