ORIX Corporation USA (ORIX USA), the U.S. operating division of
global financial services firm ORIX Corporation (ORIX), announced
the closing of OREC 2018-CRE1, a $350 million commercial real
estate (CRE) collateralized loan obligation (CLO). Initially backed
by a portfolio of 23 loans secured predominantly by newly
constructed properties, the CLO includes many loans originated for
agency takeout through one of ORIX USA’s wholly owned affiliates.
The CRE CLO is a natural extension of ORIX USA’s comprehensive
platform, with a fully integrated asset management and servicing
group.
The initial pool consists of $299.4 million in existing
commercial mortgages that were originated between 2014 and 2018 (12
in the past year), plus a $50.6 million funded reserve for assets
to be acquired during the 120-day ramp-up period. Following
closing, there is a 2 1/2-year reinvestment period. The majority of
the assets are in a pre-stabilization phase awaiting refinancing
through a permanent agency takeout loan through Fannie Mae, Freddie
Mac or the Federal Housing Administration (FHA).
“Three wholly owned ORIX USA affiliates contributed to our first
managed commercial real estate CLO, leveraging ORIX USA’s 35 years
of capital markets knowledge and commercial real estate industry
expertise,” said Hideto Nishitani, ORIX USA chairman, president and
CEO. “RED Capital Group, ORIX Real Estate Americas and Lancaster
Pollard each originated loans for the CLO. Several loans were
originated by RED Capital Group to drive business at another wholly
owned affiliate, Boston Financial Investment Management,
reinforcing our commitment to the affordable and seniors housing
sectors. Given ORIX USA’s wherewithal, we elected to retain the AA
rated through the nonrated income notes on our balance sheet and
offer only the AAA-rated class.”
All of the loans are serviced by RED Mortgage Capital. Seven
classes of notes were issued; however, the only offered class of
notes was the $190.3 million Class A notes, which were rated
Aaa(sf) and AAA(sf) by Moody’s Investors Service Inc. and Kroll
Bond Rating Agency Inc., respectively. The Class A notes benefit
from 45.625 percent credit enhancement at closing and priced at a
coupon of 118 basis points over one-month LIBOR.
Fourteen of the loans representing 62.3 percent of the initial
collateral pool are backed by multifamily properties, which include
residential and student housing properties. Four of the loans
comprising 17.1 percent of the initial collateral pool are secured
by private-pay senior assisted living facilities, with most of
these assets anticipated to be permanently financed by Fannie Mae
or FHA through an ORIX affiliate in the future. In addition to
multifamily properties, the initial collateral pool also contains
loans backed by self-storage, retail and one hotel with a
stabilized appraised loan to value of only 40.3 percent.
J.P. Morgan Securities LLC acted as sole structuring agent and
lead placement agent for the transaction. Wells Fargo Securities
LLC served as co-lead manager, and Citi acted as co-manager for the
offering.
ORIX Corporation USA (ORIX USA)
Since 1981, ORIX USA has provided innovative capital solutions
that clients need to propel their business to the next level. ORIX
USA and its subsidiaries—Boston Financial Investment Management,
Lancaster Pollard, NXT Capital, Mariner Investment Group, RB
Capital and RED Capital Group—include a team of more than 1,000
employees spanning 30+ offices across the U.S. and Brazil. ORIX USA
and its family of companies have $63 billion of assets under
management, administration and servicing (including more than $10
billion held by the company and its subsidiaries). Its parent
company, ORIX Corporation, is a publicly owned international
financial services company with operations in 38 countries and
regions worldwide. ORIX Corporation is listed on the Tokyo Stock
Exchange (8591) and New York Stock Exchange (IX). For more
information on ORIX USA, visit www.orix.com.
Lancaster Pollard
Lancaster Pollard helps healthcare and senior living providers
expand and improve their services by providing a full range of
investment banking, mortgage banking, private equity, balance sheet
financing and M&A advisory services. Lancaster Pollard &
Co. LLC, a registered broker/dealer, underwrites taxable and
tax-exempt bonds, and provides debt placement and syndication, as
well as M&A advisory services. Lancaster Pollard Mortgage
Company originates, underwrites and services mortgage loans insured
or guaranteed by governmental agencies. Lancaster Pollard Finance
Co. LLC provides balance sheet financing. The Propero™ Seniors
Housing Equity Fund LLC provides equity financing for the new
development and acquisition of seniors housing and care properties.
Lancaster Pollard has provided over $20 billion in debt and equity
capital since its inception and its mortgage servicing portfolio
exceeds $8.6 billion. The firm’s home office is in Columbus, Ohio,
and it has regional banking offices in Atlanta, Ga; Austin;
Bozeman, Mont.; Chicago, Ill.; Denver, Colo.; Kansas City, Kan.;
Minneapolis, Minn.; Newport Beach, Calif.; and Philadelphia, Pa.
For more information, visit www.lancasterpollard.com.
RED CAPITAL GROUP LLC
Recognized for its industry expertise, innovative and
comprehensive structures, and consistently high rankings, RED
Capital Group has provided over $78 billion of integrated debt and
equity capital since 1990, with a focus on the multifamily and
affordable housing industries.
RED Mortgage Capital is a division of ORIX Real Estate Capital
LLC, a Fannie Mae DUS®, MAP- and Lean-approved FHA, and Freddie Mac
small balance lender. ORIX Real Estate Capital Holdings LLC is
headquartered in Columbus, Ohio, and is a wholly owned subsidiary
of ORIX Corporation USA. ORIX Real Estate Capital has 16 offices
nationwide and approximately 330 employees. Securities, investment
banking and advisory services are provided through OREC Securities
LLC, member FINRA/SIPC. For more information on RED Capital Group
LLC, visit http://www.redcapitalgroup.com.
Boston Financial Investment Management
Boston Financial Investment Management (Boston Financial) is a
national leader in the Low-Income Housing Tax Credit (LIHTC)
industry, with a proven track record in syndication services as
well as asset and portfolio management. Since 1969, Boston
Financial has raised and managed over $11 billion of low-income
housing and historic tax credit equity investments in over 2,400
properties, making Boston Financial one of the largest firms in the
tax credit industry. For more information on Boston Financial,
visit www.bfim.com.
This press release is for informational purposes only. It shall
not constitute an offer to sell or a solicitation of an offer to
buy any securities.
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version on businesswire.com: https://www.businesswire.com/news/home/20190122005076/en/
Amanda Riderarider@marketwave.biz972.770.5083
Jeff SmithJeff.smith@orix.com214.237.2301
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