It would seem that a bond that is backed by a shelter for the homeless would not interest investors much. However, a Financial Times report said investors hungry for yields are in a hurry to make their bets on new deals bundling loans to non-traditional properties as the past few months have seen a rise in demand for debt that is backed by commercial mortgages.

Lenders like banks and other institutions that form part of the "shadow banking system" have been compelled to look for new asset types to package into commercial mortgage-backed securities or CMBS as competition to originate loans intensifies, the report said.

Citing data from Dealogic, FT reported that CMBS sales increased last year to $102 billion which represented the biggest increase since the financial crisis. Compared to the issuance in 2012, the sales in 2013 grew by 15.6%. The surge, however, has also prompted concerns about more lax underwriting standards and the issue about securitizing new kinds of loans.

Kroll Bond Ratings Managing Director Keith Kockenmeister told FT, "When there's a lack of product and a lot of people chasing it, you're bound to see some less traditional assets. You have to take each one on a case-by-case basis."

The report gave the bond sold by Citigroup as an example. There are 137 commercial mortgages that back the bond, including a loan given to a homeless shelter in 127 West 25^th Street. FT said it has not been previously been reported on but the bond already got sold in 2013.

The commercial real estate lending unit of Cantor Fitzgerald also put together a deal which included a loan given to 60 Hudson Street. The place used to be a Western Union Building but has now been transformed to a data center for computer systems. A loan to Kalahari Resort and Convention center was also included in that bond, the report said.