CMBS (Commercial Mortgage-Backed Securities)

Commercial Mortgage-Backed Securities (CMBS) are financial products created by pooling together loans made to commercial properties, like office buildings, shopping centers, or hotels. Investors buy these securities to earn returns from the interest payments on the underlying mortgages. Essentially, when property owners make their mortgage payments, those funds are distributed to CMBS investors. This allows lenders to manage risk and provides investors with a way to invest in real estate without directly owning properties. CMBS can be affected by the performance of the real estate market and the economy.