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FDIC Takes Steps to Sell $33 Billion Signature Bank CRE Loan Portfolio
The Federal Deposit Insurance Corporation (FDIC) announced today the commencement of a marketing process for a substantial $33 billion Commercial Real Estate (CRE) loan portfolio, held in receivership following the collapse of Signature Bank, New York.
The lion’s share of the CRE loan portfolio up for grabs comprises multifamily properties, primarily situated in the bustling landscape of New York City. Notably, around $15 billion of these CRE loans are secured by rent-stabilized or rent-controlled multifamily residences. Among the FDIC’s statutory obligations, it is mandated to maximize the preservation of affordable residential real estate for low- and moderate-income individuals. To fulfill this responsibility, the FDIC intends to enter into one or more joint ventures (JVs), with the FDIC retaining a majority equity stake in these ventures. Furthermore, the JV operating agreement will impose specific requirements aimed at ensuring the financial and physical preservation of these loans and their underlying collateral.
Although the FDIC will maintain a dominant equity interest in these JVs, the winning bidders or partners will serve as the managing members of these ventures and will assume responsibilities for loan management, servicing, and eventual disposition. The JV partners will operate in accordance with the terms outlined in the JV operating agreement, subject to rigorous oversight.
To address this subset of the portfolio, the FDIC actively engaged with New York City and New York State housing authorities, government agencies, and community-based organizations. These consultations were conducted to solicit input and provide information regarding the FDIC’s efforts in developing its marketing and disposition strategy.
The marketing of the former Signature Bank’s CRE portfolio is set to span the next three months, with transactions anticipated to conclude by the close of 2023. Newmark & Company Real Estate, Inc. (Newmark) has been retained by the FDIC as an advisor for this sale. Interested parties seeking additional information about the sale and qualification requirements can reach out to Newmark at NewmarkSBBPortfolio@nmrk.com. Throughout the marketing process, the FDIC and Newmark will actively engage potential bidders and provide guidance on the qualification process. For more general information about the FDIC’s asset sales program, interested parties are encouraged to visit the FDIC’s website.
It is important to note that this announcement serves solely for informational purposes and does not constitute an offer to sell, or a solicitation of an offer to buy, any loans or securities or any interest therein.
Read the press release from the FDIC HERE
