Värde Partners Closes $1B CLO

Värde Partners has closed a $1 billion managed commercial real estate collateralized loan obligation that consists of 19 floating-rate mortgages secured by 40 properties across 16 states. It is the global investment firm’s largest CRE CLO and its 13^th securitization overall.

The majority of the underlying loans–66 percent–are for industrial and multifamily properties that were originated by Värde Partners through its CRE lending platform. The collateral pool also includes hospitality, self storage, medical office and neighborhood retail assets.

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One of the assets within the CRE CLO is a $125 million loan refinancing 630 Flushing Ave., a flex industrial and manufacturing property in Brooklyn, N.Y., provided by Värde Partners in October to an affiliate of Acumen Capital Partners LLC. The Acumen affiliate acquired the 7.8-acre property in 2011 and made extensive capital improvements. The asset is currently 88 percent leased.

VMC 2026-FL6 is priced at a weighted average spread of Term SOFR plus 1.91 percent with an implied advance rate of about 88.63 percent. It is structured with a 30-month reinvestment period.

Company officials said the successful close of its largest CRE CLO reflected the depth and consistency of its origination platform and capital markets execution. They noted there was strong investor interest in the issuance.

Wells Fargo Securities LLC was the sole structuring agent and served as lead-left joint bookrunner. Goldman Sachs, Morgan Stanley and ATLAS SP Securities served as joint bookrunners, while Cadwalader Wickersham & Taft LLP was the legal advisor.

CLOs part of Värde’s toolkit

Värde Partners lends across real estate sectors and shifts its focus based on underlying market fundamentals. CRE CLO issuance is one of the tools the firm uses to support and scale its CRE mortgage origination platform. Since 2017, Värde Partners has originated more than $8.5 billion in U.S. CRE loans, with six of the nine CRE CLOs successfully paid off.

In May 2021, when U.S. CRE CLO issuance was at peak levels due to the post-COVID, low-rate environment, Värde Partners closed a $928 million CRE CLO. That securitization consisted of 23 floating-rate mortgages secured by 29 commercial and multifamily properties across nine states and the District of Columbia.

Founded in 1993, the global investment firm specializes in credit and credit-related assets. The firm has invested more than $110 billion and manages $15 billion in assets across North America, Europe and Asia Pacific markets.

CRE CLO market surging–again

Värde’s $1 billion CRE securitization is part of an active first quarter for the CRE CLO sector. Trepp reports CRE CLO issuance for the beginning of 2026 through early March was $11.2 billion, up 34 percent from the same period in 2025, when it hit approximately $8.3 billion.

Total 2025 issuance was roughly $30.6 billion, and Trepp estimates this year’s activity could reach between $30 billion and $40 billion. If the Q1 pace holds, there could be about $45 billion in CRE CLO issuance, numbers not seen since 2021 when the total was also roughly $45 billion.

However, Trepp Research Director Stephen Buschbom noted in an early March report that the current CRE CLO environment differs from the 2021 market, when issuance was driven by historically low rates and abundant liquidity. In today’s high-interest rate environment, many of the CRE CLO collateral loans are transitional or value-add loans as well as short-term refinancings.

Much like 2021, though, the current CRE CLO market continues to be backed mainly by multifamily assets. What has changed is the decline of office loans during that five-year period. While office loans made up about 14 percent of the collateral in 2021, last year it was 1.2 percent, according to Trepp.

As of early March, the overall market mix was multifamily, 69.6 percent; industrial, 11.2 percent; hospitality, 4 percent; office, 2.8 percent; retail, 2.1 percent; and other sectors, such as healthcare, 10.3 percent, Trepp reports.

Last year saw several firms close large CRE CLOs, including Argentic Investment Management and Invesco Commercial Real Estate Finance Trust. In December, Argentic closed a CRE CLO backed by total debt of $951.6 million, according to reports by KBRA and Fitch. The collateral consisted of 23 interest-only loans encumbering 53 properties. More than 60 percent were multifamily loans.

Earlier that year, the Invesco REIT closed its first CRE CLO, a $1.2 billion issuance that was secured by a portfolio consisting of about 55 percent multifamily-associated loans and 45 percent industrial loans. It was the industry’s largest CRE CLO in the previous three years.