Big Banks Lead the Return of Key Funding Source for Commercial-Property Owners; Still, a Fraction of Precrash Levels
By: Lingling Wei in the Wall Street Journal
Even as woes mount in the commercial-real-estate market, a once-vital source of funding for commercial-property owners is showing signs of life.
Banks including J.P. Morgan Chase & Co., Goldman Sachs Group Inc. and Citigroup Inc. are expected to launch in the coming weeks two offerings of commercial-mortgage-backed securities, or CMBS, totaling $1.4 billion, according to people familiar with the matter. Representatives at the banks declined to comment.
J.P. Morgan is leading a $650 million offering backed by properties owned by real-estate investment trust Vornado Realty Trust, the people with knowledge of the situation said. Vornado, of Paramus, N.J., will use the proceeds to repay existing debt, these people said. A spokeswoman for the company declined to comment.