The Federal Deposit Insurance Corp. started the process to market the ~$33B commercial real estate loan portfolio that was kept in receivership after Signature Bank of New York failed, the agency said on Tuesday.
A majority of the loans being marketed is comprised of multifamily properties, primarily located in New York City. A large part of the CRE loans secured by multifamily residences are rent-stabilized or rent-controlled.
To support its obligation to maximize the preservation of affordable residential property for low- and moderate-income individuals, the FDIC will place the rent-stabilized or rent-controlled loans in one or more joint ventures, with the FDIC retaining a majority equity interest in the JV. The JV’s operating agreement will contain certain requirements that facilitate the financial and physical preservation of the loans and underlying collateral.
While the FDIC will keep a majority equity stake in the joint ventures, the winning bidders will act as the managing member of the JV and will be responsible for the management, servicing, and ultimate disposition of the loans, the FDIC said.
Marketing of the former Signature Bank’s (OTCPK:SBNY) CRE portfolio will take place over the next three months. The transactions are expected to be completed by the end of 2023.
Newmark & Company Real Estate was retained by the FDIC to advise on the sale. Interested parties should contact NewmarkSBBPortfolio@nmrk.com to obtain further information about the sale and the qualifications to participate. During the marketing process, the FDIC and Newmark will conduct outreach to potential bidders on the qualification process. For general information about the FDIC’s asset sales program, visit the FDIC’s website.
About the FDIC:
The Federal Deposit Insurance Corporation (FDIC) is an independent agency created by the Congress to maintain stability and public confidence in the nation’s financial system. The FDIC insures deposits; examines and supervises financial institutions for safety, soundness, and consumer protection; makes large and complex financial institutions resolvable; and manages receiverships.
