Europe’s debt crisis creates opportunity for U.S. firms

Miami /
Sep.September 19, 2012 04:30 PM

Amid the European debt crisis, real estate investors on this side of the pond are seeking ways to cash in on the distress. As a result, they are purchasing portfolios of troubled commercial real estate mortgage debt at heavy discounts. Some of the firms include the Blackstone Group, the Dallas-based Lone Star Funds and Colony Capital in Santa Monica, Calif. The firms reportedly aim to reap returns of 12 to 18 percent.

These sales could accelerate in the next two to three years as fewer firms “extend and pretend” — the practice of extending loan terms in hopes that loan values would improve.

Banks across Europe are believed to be selling their distressed mortgages to increase capital and prevent future losses. These banks could cut their commercial real estate exposure by nearly $800 million.

CBRE Group data show that 11 billion euros of loans are currently on the market but individual loan sales are also happening off-market. So far this year, there have been 14 loan sale transactions have totaled 7.5 billion euros in value. The loan portfolios consist of commercial property in Ireland and England; now, Spain is the next focus for such acquisitions. [NYT]


Related Articles

arrow_forward_ios
G6 Hospitality CEO Rob Palleschi and the Motel 6 at 825 East Dania Beach Boulevard (LinkedIn, Google Maps)
Blackstone sells five South Florida budget hotels for $61M
Blackstone sells five South Florida budget hotels for $61M
Link Logistics' Luke Petherbridge with 115.7-acre site at 21001 Northwest 27th Avenue (LinkedIn, Google Maps)
Blackstone’s Link Logistics pays $291M for Calder’s horse racing track
Blackstone’s Link Logistics pays $291M for Calder’s horse racing track
Link Logistics' Luke Petherbridge (Link Logistics, Calder Casino, iStock)
Take two: Blackstone affiliate proposes industrial complex with movie studio at Calder’s horse racing track
Take two: Blackstone affiliate proposes industrial complex with movie studio at Calder’s horse racing track
 Rendering of Nema Miami with Russell Galbut and Bruce Menin (Crescent Heights)
Russell Galbut’s Crescent Heights scores $224M loan for Whole Foods-anchored Edgewater project
Russell Galbut’s Crescent Heights scores $224M loan for Whole Foods-anchored Edgewater project
The Mangrove Bay assisted living facility at 110 Mangrove Bay Way in Jupiter (Senior Lifestyle, iStock)
Blackstone sells waterfront assisted living facility in Jupiter at a loss for $41M
Blackstone sells waterfront assisted living facility in Jupiter at a loss for $41M
Laguna Pointe Apartments are at 903 Southwest 15th Street in Pompano Beach, 25370 Southwest 137th Avenue in Homestead and Sanctuary Cove Apartments at 5301 West McNab Road in North Lauderdale (Redfin, Apartments.com, Google Maps)
Blackstone goes all-in on South Florida affordable housing with over $300M portfolio deal
Blackstone goes all-in on South Florida affordable housing with over $300M portfolio deal
Blackstone CEO Stephen Schwarzman and the Crosskeys Apartments complex at 1850-2100 SW 81 Avenue in North Lauderdale (Getty, Apartments)
Blackstone picks up North Lauderdale apartment complex for $14M
Blackstone picks up North Lauderdale apartment complex for $14M
Kimco CEO Conor Flynn and Blackstone CEO Stephen Schwarzman with the Publix-anchored retail centers (Getty, LinkedIn, JLL)
Publix-powered purchase: Kimco partners with Blackstone in $426M retail play
Publix-powered purchase: Kimco partners with Blackstone in $426M retail play
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...