Money managers looking to cut their exposure to an investment product used to finance risky real estate deals have been finding buyers hard to come by in secondary markets.
Commercial real estate collateralized loan obligations, which bundle debt that’s typically too speculative for commercial mortgage-backed securities into bonds of varying risk, have struggled as distress rises. The latest evidence of the pain came when JPMorgan Chase & Co. strategists pointed out that CRE CLO auctions known as bids-wanted-in-competition fell 28% last year, probably in part due to credit concerns.
The signs of trepidation are in contrast to
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