CMBS / Conduit Loans: Accessing Capital Markets for Your Commercial Property
At Crestico, we’re more than just a mortgage brokerage—we’re your gateway to capital markets with CMBS and conduit loan solutions customized for strategic commercial investors.
Specialized Commercial Loans | Hard Money & Portfolio Options?
For certain commercial real estate investors and property owners, Commercial Mortgage-Backed Securities (CMBS) loans, also known as conduit loans, offer a unique and often advantageous financing solution. At Crestico, we can help qualified borrowers navigate the CMBS market to secure funding for a wide range of income-producing commercial properties. These loans are distinct from traditional bank loans and can provide access to the broader capital markets.
What are CMBS / Conduit Loans?
CMBS loans are commercial real estate loans that are originated by lenders, then pooled together with other similar loans, and finally sold as a series of bonds (securities) to investors on the secondary market. The “conduit” refers to the process of pooling these mortgages. The payments from the underlying mortgages are used to pay the principal and interest to the bondholders.
This structure allows for financing across a diverse spectrum of property types and often caters to borrowers seeking specific loan features not always available through traditional lending channels.
Wide Range of Property Types
CMBS financing is available for most major commercial property types, including:
Multi-Family and Mixed-Use Properties
Office Buildings
Retail & Shopping Centers
Industrial & Warehouse Facilities
Hospitality (Hotels)
Self-Storage Facilities
Important Considerations for CMBS / Conduit Loans
While CMBS loans offer many benefits, there are also unique characteristics to consider:
Prepayment Penalties
These loans often have significant prepayment restrictions or penalties, such as defeasance or yield maintenance. This makes them less suitable for borrowers who anticipate selling or refinancing the property before the loan matures.
Less Flexibility
Once a CMBS loan is securitized, it is managed by a master servicer and a special servicer according to the terms of the Pooling and Servicing Agreement (PSA). This can result in less flexibility for loan modifications or workout scenarios compared to a portfolio loan held by a bank.
Standardized Underwriting
The underwriting process for CMBS loans is highly standardized to meet the requirements of the capital markets.
Closing Process & Costs
The closing process can sometimes be more complex and may involve higher upfront costs compared to traditional loans.
Navigating Your Financing Options
If you’re unsure where to begin or would like personalized guidance, our experienced loan specialists are ready to listen to your needs and help you navigate your options, ensuring you make an informed decision.