October CMBS Issuance reaches highest monthly level in 4 years
Steve Baumgartner, Nov 2024 - 2 min read 
Image source: Pexels © Yan Krakau
Non-Agency CMBS Market Overview
U.S. Non-agency CMBS issuance continued its torrid pace reaching $14.5 billion in aggregate volume in October. That is the highest single-month issuance number since November of 2021 and clearly shows the momentum in the primary markets which was driven by positive macro numbers, expectations of future cuts by the Federal Reserve as well as hope for clarity with the U.S. election cycle ending.
Source: Commercial Mortgage Alert, Morningstar Credit
Aggregate non-agency CMBS issuance for 2024 sits at just under $88 billion leaving $100 billion issuance for the year well within reach and possibly might hit as soon as the end of November.
In line with recent trends, Single Asset Single Borrower issuance remained strong in October with almost $11.5 billion of the monthly issuance coming in the form of SASB deals. The securitization of the iconic Rockefeller Center in New York City totaled $3.4 billion. From all reports, this deal was well received and shows that there is still an appetite for high-quality, conservatively underwritten trophy office properties. Aggregate SASB issuance closed out October more than triple the 2023 total issuance volume with over $60 billion pricing so far in 2024.
Source: Commercial Mortgage Alert, Morningstar Credit
While perhaps a bit less remarkable than SASB, 2024 CMBS conduit issuance continues to outpace 2023 volumes. Through the end of October 31 conduit deals totaling almost $27 billion pricing through October vs 20 deals and $15.5 billion through the same period last year.
In the CRE CLO markets, two deals hit the market in October adding an additional $1.8 billion to the 2024 total which stands at $8.7 billion across 11 deals again significantly greater than 2023 aggregates which came at 9 deals and just over $6 billion in volume.
Summary
Non-Agency CMBS issuance markets powered through October reaching monthly levels that had not been seen in years. Expectations for further interest rate cuts as well as an increasingly optimistic economic outlook are driving issuance and deals are getting done. Consensus estimates have the rest of 2024 and early 2025 looking to remain strong with many opportunities to get deals done.
