Deutsche Bank unit wins Capmark loan sale
NEW YORK |
NEW YORK (Reuters) - Deutsche Bank AG (DBKGn.DE) said on Thursday it was the winning bidder of a portfolio of loans with a face value of $911 million (591.7 million pounds) sold by Capmark Financial Group Inc (CPMK.PK), ending a fiercely competitive auction process that attracted hedge funds and private equity players.
The collection of mostly still performing yet highly levered loans are to be sold to Deutsche Bank's Special Situations Group, which deals in more complex real estate financing and buying distressed commercial mortgage debt.
"The bank's purchase of this high quality real estate portfolio is to meet the needs of clients of our commercial real estate business," a Deutsche Bank spokeswoman said.
Deutsche Bank declined to disclose the price it will pay for the portfolio. But a source familiar with the deal said the winning bid would come to about 82 to 83 cents on the dollar based on the face value of $930 million when the portfolio hit the market last month.
A spokesman for Capmark declined comment.
The pending sale marks another auction of loans sold by lenders who are winding down their operations -- victims of the credit crisis, the downturn in commercial real estate, and, in some cases, aggressive lending.
The portfolio consists of 57 loans on about 65 properties, sources said. The largest is a $96.8 million mortgage on 26 golf courses owned by a joint venture between Parthenon Capital of Boston and Joe Guerra's Sequoia Golf of Peachtree City, Georgia.
That is followed by two loans on Chicago properties: an $80.1 million mortgage on the Double-Tree by Hilton hotel at 300 East Ohio Street and a $48.5 million mortgage on a 523,000 square-foot office building at 1 North State St.
Capmark, which was created in March 2006 through a leveraged buyout of the commercial real estate assets of GMAC, General Motors' finance arm, filed for bankruptcy in 2009. It emerged last year under a $4 billion reorganization plan and was ordered to liquidate its portfolio.
Last month, US Bancorp (USB.N), Wells Fargo & Co (WFC.N) and private equity firm Blackstone Group LP (BX.N), emerged as the winners of a $740 million portfolio of performing loans sold by German lender Eurohypo.
Many failed European banks have sold loans backed by U.S. commercial real estate. The biggest offering came last year, when Anglo Irish Bank Corp Ltd ANGLLN.UL sold its vast portfolio with a face value topping $9 billon. Wells Fargo, Loan Star Funds and JPMorgan Chase & Co (JPM.N) won that bid.
(Reporting By Ilaina Jonas; Editing by Gary Hill, David Gregorio and Phil Berlowitz)
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