Developers Diversified sells first CMBS TALF deal

NEW YORK Nov 16 (Reuters) - Developer Diversified Realty Corp (DDR.N) sold the first commercial mortgage-backed securities offering since mid-2008 on Monday, with help from an emergency Federal Reserve lending program, market sources said.

The mall owner sold $323 million of AAA-rated five-year notes at a narrower 1.4 percentage point premium to the five-year interest rate swap benchmark. Strong investor demand allowed the issuer to reduce yield premiums from earlier guidance of 1.6 to 1.75 percentage points, the sources said.

The offering was the first sold under the Term Asset-Backed Securities Loan Facility, known as TALF, for new issue CMBS. (Reporting by Nancy Leinfuss; Editing by James Dalgleish)