Chicago-based HFF recently closed the sale of a $96.2 million commercial loan portfolio on behalf of a major life insurance company.
The portfolio consisted of 28 sub- and non-performing loans secured by retail, office, self-storage and industrial properties in addition to loans on a parking garage and land parcel.
The properties are located in secondary and tertiary markets in 14 states, and the average loan size was about $3.5 million. Three of the loans were sold separately prior to the marketing of the remaining 25 loans.
Although the seller’s preference was to sell the remaining portfolio to one or a very limited number of investors, HFF provided investors with a menu approach; investors were given the opportunity to bid on the entire portfolio, any group of loans or individual loans. More than 40 offers were procured, 10 of which were for the entire portfolio. The 25-loan portfolio was sold in its entirety to a single distressed debt fund. The sale was closed about two weeks after the deal was awarded.
This sale followed two earlier portfolio sales, aggregating about $89.1 million, on behalf of the same seller. The portfolios consisted of 20 higher-risk performing, sub-performing and non-performing loans on retail, self-storage, office and industrial properties in addition to a loan on an ice-skating rink.
The average loan size on these portfolios was slightly larger at about $4.5 million. HFF again provided investors with a menu approach to bidding. In contrast to the previously mentioned sale, however, five of the 20 loans were sold separately and the remaining loans were divided between one distressed debt fund and a life insurance company. Sales for these portfolios were executed in a timely manner as well.
The HFF team representing the seller was led by senior managing director Stuart Salins.