Commercial mortgage-backed securities (CMBS)
Bonds backed by mortgage loans on commercial property. Data centre CMBS is often single-asset, single-borrower (SASB) and floating rate, an alternative to master trust ABS.
How it works
Commercial mortgage-backed securities are bonds backed by mortgage loans on commercial property. The bonds are repaid from the borrower's loan payments, and ultimately from the property.
In GPU and data centre deals
Data centre CMBS is often single-asset, single-borrower: one large loan secured on a data centre or portfolio and sold to bond investors. It is used to refinance stabilised, leased data centres, including hyperscaler campuses. Compared with ABS, CMBS relies more on the mortgage over the property and a loan to value test, and the loan usually has a shorter, floating-rate structure with extension options.
What gets negotiated
- Loan to value and debt yield
- Extension options and interest rate caps
- Tenant concentration and lease terms
- Cash management triggers
How it works in a deal
Commercial mortgage-backed securities are bonds secured on mortgage loans over commercial property. For data centres they are usually single-borrower deals secured on a portfolio of stabilised buildings, priced off the property and its leases.
Example. Blackstone's BX 2025-VOLT deal raised US$3.5bn secured on about ten QTS data centres; its D notes were reported as about 23 times oversubscribed. QTS: BX 2025-VOLT CMBS →
For in-house counsel
Take it to the documents
The filed wording behind GPU and data centre financings, for either side of the table. Previews are open; the full text is free with InfraCompute Weekly.
- Financing clause libraryCash traps, coverage ratios, cures and step-in, from the filed deals.
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- Issues list builderBuild an issues list from the lender’s or the borrower’s side.
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Related terms
Explanatory definition, not a statement that a particular transaction contains this term or a substitute for its contractual definition.
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