Redwood, which has also led a revival in selling securities tied to home loans without the backing of the U.S. government, sold $172 million of bonds linked primarily to commercial mezzanine loans in November, the first sale of its type in five years.

The transaction, arranged by UBS AG, includes 30 loans on buildings ranging from the Gansevoort Hotel in Manhattan to the RiverTown Crossings shopping mall in Grandville, Michigan, according to data compiled by Bloomberg. Mezzanine debt is repaid after the first mortgage and can bridge the gap between how much a landlord owes and how much the property is worth.

The deal “increases our ability to make additional investments in commercial real estate in an industry where there is more capital needed than there is capital” available, Michael McMahon, a managing director at Redwood, said in a telephone interview.

Jumbo Deals

The Mill Valley, California-based firm kept the so-called subordinate tranche, which is first in line to incur credit losses. “We are certainly standing behind the deal which is consistent with Redwood’s strategy as a credit investor,” he said. Redwood this month sold bonds tied to $398 million of so- called jumbo mortgages, following six sales last year that packaged almost $2 billion of the loans, according to data compiled by Bloomberg.

NorthStar Realty Finance Corp., a New York-based commercial- property lender and investor, issued $351 million of securities linked to so-called transitional properties in October. The mortgages were taken out on the expectation that income from the buildings will increase, with vacancy rates as high as 40 percent, according to deal documents.

At the Cherry Hill mall in Cherry Hill, New Jersey, the value of the property is forecast to climb to $115 million by December 2014 from $100 million as of June, the documents show.

Representatives from NorthStar didn’t respond to e-mails and phone calls seeking comment.

Labeling Deals

Firms aren’t marketing the new deals as CDOs, Hill said, even as the securities contain the same type of collateral found in CDOs completed prior to the crisis. Some are seeking to label them collateralized loan obligations, which are typically linked to corporate loans often used to fund leveraged buyouts.