Lone Star and JPM close in on Commerzbank portfolio

The Dallas-based group and investment bank JPMorgan are poised to acquire a €4.3bn CRE loan portfolio put up for sale by Commerzbank, according to reports.

Lone Star Funds and JPMorgan reportedly are in pole position to acquire a portfolio of Spanish property loans for up to €3.9 billion.

German lender Commerzbank is offloading the loan portfolio at a discount, Reuters reported, with the final purchase price likely to be between €3.7 billion and €3.9 billion. Spanish daily Expansion suggested a sale price of €3.5 billion was more likely.

If successful, the deal would be the latest loan portfolio acquisition by Lone Star, which has become one of the dominant players in the market. Earlier this year, it won the auction for a large part of a £6.3 billion portfolio of UK loans sold by Anglo Irish Bank.

About €1 billion of the Commerzbank portfolio is nonperforming debt, while performing loans secured against commercial real estate account for the remaining €3.3 billion in the portfolio. A 25-strong team from Commerzbank is understood to be moving to Lone Star to help the Dallas-based investment group manage the loan portfolio, Reuters noted.

Lone Star could not be reached for comment by press time.