Royal Bank of Scotland Group PLC is selling bonds backed by commercial mortgages from several borrowers in the first sale of its kind since June 2008, gauging investor demand for the debt amid climbing defaults.

The offering, backed by 81 properties in states from New York to Missouri, comprises $240.8 million in top-rated securities, according to people familiar with the sale who declined to be identified because the terms are private.

The new issue highlights the challenge facing Wall Street in reviving the $700 billion market as delinquencies rise and the value of mortgages fluctuates. Unlike other banks working on sales, Royal Bank of Scotland skirted the risk of holding the debt by not closing the loans as they were being pooled, the people said. RBS bankers have been arranging the deal for several months, they said.

"Nobody wants to sit with a huge book of business they haven't sold," said John Levy, the president of the Richmond, Va., real estate investment banking firm John B. Levy & Co. "Accumulating this stuff for the long term is a problem. What if the music stops again?"

Bank of America Corp., JPMorgan Chase & Co., Deutsche Bank AG, Wells Fargo & Co. and Goldman Sachs Group Inc. are all approaching borrowers with terms for commercial mortgages to be packaged into securities and keeping the loans on their books until they're sold, according to people familiar with the discussions.

That exposes the banks to risk because they need several months to assemble the mortgages from different borrowers, and it's hard to guard against price swings on the debt in the interim, the people said.

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