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 Sternlicht’s investment firm, Starwood Capital will buy LNR’s U.S. property-development unit and the other half of the interest for $197 million.

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.

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“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