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CMA
February 21, 2020  

Sabal's CMBS Program Gaining Momentum

Sabal Capital has added five more staffers to its fast-growing commercial MBS team, whose debut conduit deal was in the market this week.

The recruits, who joined the Irvine, Calif., lender within the last month, included three industry veterans who signed on as managing directors: David Garcia, Barry Gersten and Peter Lewicki. The other new arrivals were underwriter Michael Castelli and underwriting analyst Hussain Syed.

Sabal is slated to price its first CMBS issue today, with Goldman Sachs and Deutsche Bank running the books (SBALR 2020-RR1). The $400 million offering is typical of conduit deals in that it is backed by long-term, fixed-rate mortgages that Sabal originated on a diverse mix of property types. What sets it apart are relatively small loan balances of $1.1 million to $21 million, with an unusually heavy concentration of multi-family collateral (62%). And while most conduit paper is sold publicly, Sabal’s bonds will be issued privately under SEC Rule 144A.

Sabal, a unit of Stone Point Capital of Greenwich, Conn., traditionally has focused on the agency multi-family market, where it routinely originates small-balance Freddie Mac loans and buys the B-pieces of Freddie’s commercial-mortgage securitizations. But its CMBS team has grown rapidly since forming early last year under managing director Bob Restrick. There are currently 18 staffers in that unit, which focuses on non-agency mortgages with balances up to $25 million. Of the new recruits, Lewicki works in the firm’s San Francisco office, while the rest are based in New York.

Garcia previously was a senior vice president at Oritani Bank of Washington Township, N.J., where he spent the last 12 years overseeing various parts of the commercial-mortgage business. Before that, Garcia worked in the CMBS group at UBS.

Gersten came from Bedrock Capital, a New York bridge lender that he founded in 2009 and continued to run as managing principal following its acquisition by One William Street Capital in 2014. He previously worked at Capmark and Lehman Brothers.

Lewicki was a vice president focusing on CMBS loan originations at Societe Generale, which hired him and a number of commercial-mortgage securitization pros from RBS in early 2015. His prior employers included Wells Fargo.

Castelli was an analyst at Hanover Street Capital, an asset-management unit of SitusAMC that supports Deutsche Bank’s commercial real estate lending group. Before getting hired there last March, he spent nearly two years at Marcus & Millichap.

Syed was a credit analyst for eight months at New York-based Axiom Capital, following a brief stint at Capital Bank, a unit of Chemung Canal Trust of Elmira, N.Y.

Sabal continues to recruit seasoned staffers for its CMBS unit and other areas as it aims to become “the industry’s preferred single-source lender . . . in the small- and mid-balance sectors,” said chief executive Pat Jackson.

Sabal’s issuance plans call for completing two more conduit transactions this year, each of $400 million or more. Sources said its debut deal was being well-received by investors, partly due to a lack of other conduit offerings in the market this week.

Initial price guidance was unavailable, but the early “whisper” talk on the long-term, super-senior bonds was 110-115 bp over swaps. Near the bottom of the investment-grade capital stack, the paper rated Baa3/A (low) by Moody’s and DBRS Morningstar was whispered at 225-250 bp. The class rated “BBB (low)” by DBRS Morningstar alone was being shopped early on at 375-400 bp.