CMBS syndication occurs when multiple lenders pool their funds together to issue a large CMBS loan. This reduces the risk of having the entire loan on any one lender’s balance sheet.
What is CMBS Syndication?
Agency CMBS vs. Non-Agency CMBS
There are two types of commercial mortgage-backed securities (CMBS), agency CMBS, which consist of loans pooled by government-sponsored entities (GSEs) including Ginnie Mae, Fannie Mae, Freddie Mac, and non-agency (private) CMBS, which consist of loans pooled and securitized by private lenders, such as JP Morgan or Goldman Sachs.
What is a Master Servicer?
CMBS loans are not serviced by the lender who issued the loan and are instead serviced by third-party entities referred to as master servicers. In many situations, the master servicer will assign the day-to-day servicing duties to another entity, known as a primary servicer.
What is a Conduit Loan?
Conduit loans, which are more commonly referred to as CMBS loans, are commercial real estate loans that are pooled together and sold to investors on the secondary market.