While not even on the menu six months ago, the market for commercial mortgage-backed securities (CMBS) has become a front-burner entrée as lenders finally have all the ingredients for making new loans. According to “Mastering the Recipe,” the latest podcast produced by John B. Levy & Co., commercial real estate lenders continue to search for the right mix of leverage level and loan pricing as they try to bring a tepid secondary market to a simmer.

“After groping around in the dark for the right combination of ingredients, commercial lenders just might have found the right recipe for exciting the current market,” says John Levy, founder of John B. Levy & Co.

“This is happening as the federal government — through the Term Asset-Backed Securities Loan Facility (TALF) program — seems to be backing away from helping private enterprise, both for the commercial and the single-family markets,” Levy adds. “Interestingly, only one of the three CMBS deals completed last year came through TALF, and this program expires shortly.”

Levy is an expert on commercial real estate financing and the effects of interest rates on commercial real estate markets. He is the originator and author of the Barron’s/John B. Levy & Company National Mortgage Survey, which Barron’s published for 23 years. His column also appeared monthly in NREI.

Listen to Commercial Real Estate: Mastering The Recipe