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 | Chicago, IL
312.263.6410 |
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Commercial Mortgage Loans are a new asset class for many investors. This is particularly true of the Small Balance Commercial Mortgage Loan segment of the market. There are high barriers to market entry, including the costs of originating, underwriting and servicing loans, state-by-state regulatory oversight of lending practices and the need for a national network of mortgage bankers. ICA offers cost effective access to this market.
Relative to other fixed income alternatives, the Small Balance Commercial Mortgage Loan segment offers outstanding risk and reward value for the appropriate investors. ICA’s focus on narrowly defined and conservatively underwritten real estate segments is based on the cumulative 80 years investment and mortgage investment experience of its principals. Historically, these market segments have experienced ten year cumulative default rates of 1.46% compared to 5.26% for BBB corporate bonds. Monthly principal and interest payments and the incremental yield earned versus public market alternatives compensate the investor for the illiquidity risk incurred by investing in a trust. Trusts originated by ICA typically have durations of 6 to 7 years. We have the capability to originate trusts with durations between 3 and 5 years.
ICA believes its product is well suited for insurance companies and other financial institutions, selected pension funds and foundations and high net worth individuals.
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