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Colony American Homes Monetizing More of its Single-Family Rental Portfolio

June 17, 2014
Colony Financial’s Colony American Homes subsidiary is prepping the second issuance of single-family rental mortgage backed securities. The new $797.9 million securitization deal is being shopped to investors this week.

CAH 2014-2 is a SFR securitization that will be secured by mortgages on 3,727 income-producing single-family homes, according to
Kroll Bond Rating Agency

The loan backing the securitization will be a non-recourse, first lien, floating rate mortgage loan originated by JPMorgan Chase Bank, N.A. on the securitization closing date and funded with proceeds of the sale of the certificates.

The floating rate loan will require interest only payments and have a two-year term with three 12-month extension options.

The underlying properties are one to four unit residential properties in seven states, with the top three representing 73% of the portfolio (California (33%), Florida (27.2%), and Georgia (12.6%).

The top three Core Based Statistical Areas (CBSAs) represent 36%, and include Los Angeles, CA (13.8%), Atlanta, GA (12.6%) and Las Vegas, NV (9.7%).

The average value of a portfolio property as of the most recent broker price opinion is approximately $214,076. The BPO values range from $51,000 to $899,000. Based solely on the purchase price, without incorporating rehabilitation costs, the BPO values represent an average of 36% appreciation since purchase.

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