The price of CMBS is determined according to the rating of rating agencies; After referring to the rating again, the investment bank determines the final issue price and issues it to investors. The sales income of CMBS will be returned to the original owner of the real estate to repay the principal and interest of the loan, and the surplus will be used as the working capital of the company.
Real estate trust and investment funds (REITs) are an important means of real estate securitization. Real estate securitization is a financial transaction process that directly transforms illiquid non-securities real estate investment into securities assets in the capital market. Real estate securitization includes two basic forms: real estate project financing securitization and real estate mortgage securitization.
The characteristics of REITs are: 1. Income mainly comes from rental income and property appreciation; 2. Most of the proceeds will be used to distribute dividends; 3.REITs have high long-term returns, but it is still controversial whether they can diversify investment risks through them.
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