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Starwood buys RE loan manager LNR in $1B deal

Barry Sternlicht
Barry Sternlicht

LNR Property, the nation’s largest manager of distressed commercial real estate loans, has been sold to Barry Sternlicht’s Starwood Property in a $1.05 billion deal, Bloomberg News reported. Starwood Property, the largest commercial-mortgage REIT, has agreed to pay $856 million for the majority of LNR’s businesses, which include its U.S. special servicing unit — which oversees more than 1,100 delinquent securitized mortgages — and 50 percent of its stake in Auction.com. Sternlicht’s investment firm, Starwood Capital will buy LNR’s U.S. property-development unit and the other half of the Auction.com interest for $197 million.

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The Greenwich, Conn.-based Starwood companies now have more than $1 trillion of commercial real estate debt in the U.S. and Europe. The firms now also have access to the pricing of troubled properties and income from fees.

“Our goal from the beginning was to build a sustainable competitive advantage in the financial markets,” Sternlicht, the founder, chairman and CEO of both Starwood companies, said in a telephone interview with Bloomberg. “We’re always looking at tilting the landscape in our favor.” [Bloomberg] —Christopher Cameron

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Barry SternlichtLNRStarwood Capital