The popularity of US CMBS backed by loans secured by property leaseholds or ground fees, or both, has waned recently. Indeed, such transactions priced in the heyday of 2014-2017 are coming under increasing stress.
“These deals were more prevalent three or four years ago. But in the Covid era, we’ve seen less and in the recovery period it’s hard to see we’ll see a return to this type of financing on any scale,” says Harris Trifon, an md and portfolio manager at investment firm Lord, Abbett and Co.
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