BAML prices reduced Taurus CMBS at blended 280bps

Bank of America Merrill Lynch (BAML) has priced its reduced €145.8m, four-and-a-half year Taurus 2015-3 EU DAC CMBS at a blended coupon of 280bps after discounting the deal.

The transaction is a securitisation of two loans made to MStar Europe, a joint venture between M7 Real Estate and Starwood Capital, secured on 62 light industrial assets in the Netherlands, France and Germany.

It was initially marketed as a €177m deal but all the tranches have been reduced in size by an overall €30m, which BAML will reportedly retain. All but the Class A notes have been discounted.

It is the third CMBS to price at discount in recent months. Goldman Sachs restructured and discounted its €182m REITALY CMBS earlier this month and was also forced to discount its £646m Logistics UK 2015 deal in August in order to sell it.

The six tranches of Taurus 2015-3 EU DAC, with DBRS/Moody’s ratings, are priced as follows:

Class    Size (€m)     Rating        LTV(%)     Price           Margin

A             60.9          AAA/Aaa        28.3         100       165 + 3m Euribor

B             14.4          AAA/Aa3        35            99.79     235 + 3m Euribor

C             15.9           AA/A3           42.4         99.37     315 + 3m Euribor

D             19.0           A/Baa3          51.2         97.95    400 + 3m Euribor

E             17.7          BBB/Ba2        59.4         94.05    550 + 3m Euribor

F             17.9           BB/B3            67.7         94.18    650 + 3m Euribor

The deal matures in April 2020 with an eight year tail period.

BAML’s two loans, named TEIF and Bilux after the two MStar portfolios each is secured on, have a combined loan-to-value of 67.7% based on the bank’s original, total facility of around €200m.

The €91m, five-year TEIF  loan, for refinancing the Tamar European Industrial Fund, has an LTV of 65% and is secured on 31 assets in the Netherlands, Germany and France. BAML provided the facility in December 2014 and has sold down about €9m so is securitising the remainder. The portfolio is valued at around €126m.

The €104m Bilux acquisition loan has an LTV of 70% and is secured on 31 assets in the Netherlands and Germany valued at €148m. BAML made the loan January.

Across the two portfolios there are 329 tenants, 125 in TEIF and 204 in Bilux, with occupancy in both portfolios 85%. By value, 39% of the assets are in France, 34% in Germany and 27% in the Netherlands. BAML will retain at least 5% of each underlying loan.

This is BAML’s third European CMBS launch this year. In January, it issued its five-year €286.4m Taurus 2015-1 IT multi-borrower securitisation of three Italian loans to Blackstone, Cerberus and Orion Capital Managers. In April, it priced its €455m Taurus 2015-2 DEU, secured by a single loan on IVG Immobilien’s The Squaire property at Frankfurt Airport.