CMBS Key to Commercial Mortgage Market Liquidity.

New York -- The development of commercial mortgage-backed securities financing has changed the financing scene for commercial properties, especially by imparting more liquidity, according to a panel session on "permanent financing" at an International Council of Shopping Centers capital marketplace conference here.

Adam Raboy, co-head of originations, CSFB, noted that in the early 1990s, an insurance company like Prudential wouldn't have made a loan on a grocery-anchored shopping center with seven years left on the loan term.

Simon Ziff, president, The Ackman-Ziff RE Group, said that the biggest insurance companies wouldn't have made have such a loan, but the smaller ones would have, with an additional charge.

The availability of CMBS financing has changed all that by imparting liquidity. And leverage levels are also higher, he noted.

Comparing CMBS and portfolio lenders, Michael J. Mazzei, managing director, Barclays Capital, said that there is always convergence in the capital markets. Insurance companies are also securitizers and buyers of CMBS today.

Generally speaking, the portfolio lender remains the final word when it comes to a loan while the CMBS side has to answer to the market and is very transparent, Mr. Mazzei said.

According to him, a lot of the differences between the financing sources are more ...