BAML to launch €445m CMBS for Frankfurt's The Squaire

Bank of America Merrill Lynch is to issue a €445 mln, five-year commercial mortgage-backed security to refinance a loan on IVG's The Squaire office complex at Frankfurt airport.

The CBMS, dubbed TAURUS 2015-2 DEU, comprises six tranches of respectively €153 mln, €61 mln, €61 mln, €56 mln, €74 mln, €40 mln and is expected to be priced shortly.

BAML originated a €470 mln term loan in late January to refinance the asset, which is Germany's largest office building with a total lettable area of 144,785 m2 and 625 indoor parking spaces.

The loan-to-value (LTV) ratio at closing will be 72.7%.

The property has an appraised market value of €644 mln, with a net initial yield of 5.2%, and is multi-let with office accounting for the bulk of its gross rental income. The asset has a weighted occupancy rate of 85.2% and an average unexpired lease term of 10.3 years.

The Squaire was put on the market by its owner IVG last September and subsequently withdrawn after bids from international investors fell short of its valuation of €700 mln. At least three bidders – Blackstone, BlackRock and Tishman Speyer – were believed to be in the running to buy the ship-like building, which IVG built for €1 bn in 2011.

In January IVG said it had terminated the sale process after securing a refinancing package with Bank of America Merrill Lynch over a five-year term.