CMBS prices have slowly risen since the earthquake and tsunami in Japan on March 11 and subsequent concerns about unrest in the Middle East. Prices have recovered close to levels seen before the disaster. Spreads on senior investment-grade CMBS have generally tightened 5-10 basis points weekly. Better performing legacy CMBS pools, primarily those issued prior to 2006, have tightened more dramatically versus 2007 issues.
“We took the opportunity during the period of volatility to add more CMBS exposure at attractive prices for our client Country Bank,” said Michael D. Sneden, Executive Vice President at ValueXpress. “We have advised Country Bank on the purchase and sale of over $200 million of CMBS since the height of the credit crisis in late 2008, and the program helps us keep in constant touch with supply and demand on the CMBS side of the market. The appetite for new originations is very strong right now.”