Blackstone’s BREDS loaf just rose by $2B.

The private equity giant’s Blackstone Real Estate Debt Strategies fund acquired roughly $2B in performing multifamily and retail loans from Atlantic Union Bankshares Corp. at roughly a 7% discount to their face value, the companies announced Thursday.

Blackstone has been deploying cash from its BREDS fund, which closed on another $8B round of fundraising in March, to acquire large portfolios of commercial real estate debt. It has spent roughly $20B acquiring loans in the last 24 months.

The pool of Atlantic Union loans had previously been set aside for sale as part of a merger between the Virginia-based bank and Maryland-based Sandy Spring Bank that closed on April 1.

“We were pleased to work with Blackstone Real Estate on this transaction, which both sides executed seamlessly,” Atlantic Union CEO John Asbury said in a statement. “The loan sale transaction reduces our CRE concentration and frees up capacity for potential future growth.”

The loans were sold “in the low 90s as a percentage of par value,” and Atlantic Union will maintain debt servicing responsibilities, according to a release. The bank plans to pay down some deposits and funds with the proceeds from the sale while expanding its securities portfolio.

The loans were made before interest rates jumped and had since lost value, according to The Wall Street Journal, which first reported the deal. The debt was marked down to reflect today’s valuations on Atlantic Union’s balance sheet before being sold off, which allowed the bank to avoid recording a loss on the deal.

Most of the debt had initially been underwritten by Sandy Spring prior to the merger, per the WSJ.

BREDS’ recent transactions include the purchase of a 20% stake in a $17B portfolio of debt from the now-failed Signature Bank, with the Federal Deposit Insurance Corp. holding on to the remaining share. It also purchased a $1B senior mortgage loan portfolio from German lender Deutsche Pfandbriefbank last May.

Private equity has been growing its presence in the commercial real estate debt space in recent years, filling in where banks' lending had largely dried up. Billions have been raised by a host of funds, including California-based Beach Point Capital and Chicago-based Heitman.

Banks have even turned to private equity as a way to invest in commercial real estate without further weighing down their balance sheets, which are already straddled with properties whose values have fallen.