The Federal Deposit Insurance Corp. (FDIC) has begun the marketing process for the approximately $33 billion commercial real estate (CRE) loan portfolio retained in receivership following the failure of Signature Bank.
“The majority of the CRE loan portfolio being marketed is comprised of multifamily properties, primarily located in New York City,” said the FDIC in a press announcement. “A large portion (approximately $15 billion) of the CRE loans secured by multifamily residences are rent stabilized or rent controlled. The FDIC has a statutory obligation, among other factors, to maximize the preservation of the availability and affordability of residential real property for low- and moderate-income individuals.”
The FDIC added that it would this obligation by placing the rent stabilized or rent controlled loans in one or more joint ventures (JV), with the regulator retaining a majority equity interest in the JV.
“While the FDIC will retain a majority equity interest in the JVs, the winning bidders, or partners, will act as the managing member of the joint venture and will be responsible for the management, servicing and ultimate disposition of the loans,” the regulator added. “The JV partner will be required to manage the portfolio in accordance with the JV operating agreement and be subject to stringent monitoring.”
The marketing of the Signature Bank portfolio will take place over the next three months and the transactions are expected to be completed by the end of the year. Newmark & Co. Real Estate Inc. (Newmark) was contracted as an advisor on this sale and interested parties are asked to contact NewmarkSBBPortfolio@nmrk.com to obtain further information.
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