Blackstone To Buy UK And U.S. Loan Book From German Lender

Part Of A Loan Secured Against The Connaught Hotel Is In The Portfolio Being Bought By Blackstone

Blackstone is in talks to buy an £800M ($1B) portfolio of loans from German lender Deutsche Pfandbriefbank.

The portfolio comprises senior performing loans, split roughly equally between the U.S. and UK, React News reported.

PBB has written down the value of its U.S. loan portfolio, but this is not a distressed loan deal. The average discount on the loans being paid by Blackstone is just 6%, React reported. The 11-loan portfolio is being bought by Blackstone Real Estate Debt Strategies, the investment giant’s real estate lending business.

UK loans in the portfolio include a £110M slice of a loan secured against the five-star Qatari-owned Berkeley and Connaught hotels and a loan to the Angel Gardens build-to-rent scheme in Manchester, owned by Moda and Apache Capital.

U.S. loans include facilities secured against 95 Morton St. in New York, 1700 Pennsylvania Ave. in Washington, D.C., and 325 Main St. in Greater Boston.

PBB has a €2.6B (£2.3B, $2.8B) UK loan portfolio and a €5.1B U.S. loan portfolio. Of that U.S. portfolio, €4.5B is performing and €600M is nonperforming. The entirety is secured against offices, with 78% on the East Coast, 11% on the West Coast and 11% in Chicago.

In 2023, it wrote down the value of its performing U.S. loans by 19% and its nonperforming loans by 35%. It has taken more than €300M of loan losses, which it said would cover the expected fall in value of its U.S. loans.

BREDS has about $24B of assets under management, according to Blackstone’s full-year 2023 results. Its debt funds have made an average 9% net internal rate of return over their existence.

BREDS teamed up with the Canada Pension Plan Investment Board and Rialto Capital in December to buy a $1.2B slice of a $17B loan portfolio from failed lender Signature Bank, with the Federal Deposit Insurance Corp. retaining the remainder.

Continue reading this story with a free account

Log in or register
Sign up for more articles like this
Subscribe to Bisnow's London Newsletters
Related Stories

JVP Development Is Betting $37M Of Its Own Money That Frisco Is Ready For Spec Office

Treasuries Hover Around 4.7% As Wall Street Questions If Warsh Is A 'Dove In Hawk's Clothing'

Avison Young Had Assets Frozen By Bank Over Unpaid Taxes

Equinix Bets Big On Slough Data Centres: The London Deal Sheet

JLL Nearly Doubles Profits, Fueled By Leasing Rebound

Dewberry's Midtown Eyesore Quietly Resolves $75M Mortgage

Newmark Posts Record Q2 Revenue, Holds Guidance Flat

Redevco Buys 560K SF Jaguar Land Rover Logistics Hub In UK IOS Push

BXP's 343 Madison Lands $1.2B Loan, Nears Deal With Equity Partner

Fed Holds Rates In Split Decision As Iran War Hampers Inflation Fight

Unite Looks To Reshape Student Portfolio After £417M First-Half Loss

Allow Fortress To Reintroduce Itself: The Distress Specialist Is Expanding Its Game