Waterfall’s SBC strategy seeks to enhance returns through non-recourse leverage via the issuance of asset backed securities backed by SBC loans. The firm’s expertise is founded upon the deep experience of its principals, who began actively investing in SBC loans in the early 1990s. Since 2008, through its comprehensive SBC platform, Waterfall has purchased approximately $1 billion in loan assets nationwide.
Investor-owned real estate including mixed use, multi-family, retail and office or owner-occupied business loans.Approximately $750,000 average principal balance.An underserved niche market, Waterfall seeks SBC loans which generally possess the following characteristics: The SBC strategy seeks to capitalize on sector’s distress through the purchase of credit-distressed legacy SBC portfolios (primarily offered in the market by community banks continuing to restructure post-credit crisis) and the origination of new SBC loans funded in the securitization market. The credit crisis left approximately 35% credit-distressed and the exit of most lenders reduced SBC origination volume by approximately 50%. Spector Group has recently accomplished the design of the Waterfall Asset Management offices, an investment management firm, located in New York City, New York. The Waterfall High-Yield ABS strategy seeks to invest in assets with the following characteristics:Īs of December 2012, the Small Balance Commercial (SBC) loan sector of the real estate market was $588 billion. Location New York City, New York, United States. Waterfall Asset Management is an institutional asset manager focused on structured credit (asset-backed securities and loans) and private equity investments. Waterfall’s high-yield strategy has the ability to employ leverage and Waterfall actively seeks to hedge both interest rate and credit (tail) risk. The firm seeks to create a considerable new issue pipeline through existing direct relationships with specialty finance companies and an expansive network of brokers. In addition to its multi-sector focus, Waterfall is one of the few ABS specialists to source product through three distinct channels: the distressed secondary markets, new issue market and purchase/securitization of whole loans. Waterfall seeks relative value across the entire market, particularly esoteric sectors, examples of which include timeshares receivables, small balance commercial mortgages and reverse mortgages.
The investable universe of ABS includes over 60 sectors and extends well beyond traditional structured credit – notably residential mortgage backed securities (RMBS). We look forward to closing this transaction, welcoming the RMS team, clients and customers to the Ocwen/PHH family, and continuing our long-term partnership with Waterfall. Waterfall is strategically positioned to leverage the expertise and experience of its founding principals – Tom Capasse and Jack Ross – who established Merrill Lynch’s ABS Group in the 1980s and created many of the first securitizations. Despite the recovery in the multi-trillion dollar global Asset Backed Securities (ABS) market since the depths of the financial crisis, hundreds of billions of dollars of legacy distressed ABS remain outstanding.
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