Blackstone Inc. is issuing $1.05 billion in commercial mortgage-backed securities (CMBS) to help finance its April acquisition of apartment landlord AIR Communities. The debt issuance consists of six tranches, with credit ratings ranging from AAA to BB-, according to sources familiar with the deal. The bonds are backed by an interest-only loan with a floating rate.
This latest bond sale follows a $2.95 billion CMBS offering by Blackstone in July, also secured by properties owned by AIR Communities.
In April, Blackstone agreed to purchase Apartment Income REIT (AIR Communities) for $10 billion, committing an additional $400 million to enhance and maintain its portfolio of apartment buildings.
CMBS issuances have surged this year, reaching $69.7 billion in sales as of Monday. While spreads on the debt have widened since the start of the year, they remain below the levels seen last year, when concerns over the credit quality of commercial real estate were more prevalent.
A Blackstone representative declined to comment on the bond sale.
