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 100 years investment and mortgage investment experience of its principals. 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 ICA Loans. Loans originated by ICA typically have durations of 6 to 7 years. We have the capability to originate loans with durations between 3 and 5 years. The treasury “make whole” yield maintenance provision provides superior convexity