Cerberus tops Europe with €17.7bn of NPLs

The New York-based firm ended 2014 as the largest buyer of European nonperforming loans after a run of 12-plus deals in the region, accounting for nearly 22 percent of the market.

Cerberus Capital Management, the New York-based firm, has been as named the leading investor in European non-performing loans in 2014 in a report by Cushman & Wakefield.

The real estate broker reported that Cerberus affiliates invested approximately €17.7 billion in European NPLs in 2014, constituting nearly 22 percent of the €80.6 billion in closed commercial real estate and real estate-owned transactions for the year. This is the second year in a row that Cerberus has topped the broker’s chart.

Last year the company completed more than a dozen deals across Europe, acquiring loans and assets in the UK, Germany, Spain, Italy, Ireland, France and Denmark, among other countries.

Significant transactions included; the Project Eagle portfolio purchased from Ireland’s National Asset Management Agency (NAMA); the Project Aran portfolio sold by Royal Bank of Scotland (RBS) subsidiary Ulster Bank; the Project Avon portfolio acquired from Lloyds Banking Group; the Project Chestnut portfolio bought from National Australia Bank (NAB); and, the Project Mermaid portfolio divested by Denmark’s Finansiel Stabilitet.

Cushman & Wakefield’s report also identifies the other NPL category killers in Europe, those being Lone Star Funds which invested €16 billion, The Blackstone Group with €8.7 billion, CarVal Investors with Goldman Sachs on €6.2 billion, though that does not count their individual transactions, JPMorgan on €4.2 billion, then Deutsche Bank, Oaktree Capital Management, Kildare Partners, Kennedy Wilson and Colony Capital.

In the report, the broker added: “In respect of the unprecedented levels of acquisitions by private equity firms in 2014, 92 percent of the related closed volume is associated with companies from the US. The three largest buyers, Cerberus, Lone Star and Blackstone account for 70 percent of all closed European transactions involving private equity in 2014.” It added: “Whilst capital sources have diversified over the past 12 months, it appears that the origin of buyers continues to be heavily skewed towards North America. This in part stems from the improving property fundamentals across Europe, the severity of the crisis that hit the region and also due to US firms’ perception of value, with the returns available in the recovering economies of Europe higher than those on offer at home.”