Mariner acquires $760m FDIC portfolio for $52m

Mariner Real Estate Management has bought a $760 million portfolio of development and construction loans from the US banking regulator, the Federal Deposit Insurance Corporation, for $52 million.

The Leawood, Kansas-based real estate investment firm formed a 40-60 joint venture with the FDIC to take over the pool of 1,100 residential and commercial loans, including development and construction mortgages.

The loans were pooled from 20 failed banks covering 24 states in the US, Mariner said in a statement.

Like other structured sales closed by the FDIC, Mariner will take a 40 percent interest in the venture, while the regulator will retain a 60 percent interest. The FDIC has provided 1:1 leverage through a $105 million of non-resource, zero-percent loan, as well as a $25 million working capital credit line.

Mariner acquired the loan pool through its $50 million Mariner Real Estate Partners fund and the follow-on vehicle Mariner Real Estate Partners II, a fund which raised capital on a deal-by-deal basis, according to co-president Terry Anderson. Both funds are now fully invested at more than 90 percent.

Real estate capital services firm Cohen Financial will help Mariner work out the loan pool, which will include loan modifications, discounted pay-offs and a “significant amount of foreclosure”. Anderson said the portfolio could take between four and six years to be fully worked out.

The FDIC has been actively disposing of assets from failed banks through structured sales, in which it takes a 60 percent stake but provides zero-percent financing and credit lines to fund working capital needs.

In July, Oaktree Capital Management acquired 280 loans with a face value of $1.7 billion of distressed real estate loans from Am Trust in partnership with home builder Toll Brothers.

That same month, Colony Capital closed its second FDIC loan portfolio, acquiring a 40 percent stake in a book of 1,660 loans, for $445 million via a joint bid with Cogsville Group.

The Los Angeles-based private equity real estate firm agreed to pay 59 cents on the dollar for the portfolio, which has a face value of $1.85 billion and includes loans from 22 failed banks. Around half the loans in Colony's second portfolio were delinquent, with three-quarters of the mortgages secured against assets in Nevada, California, Colorado, Arizona and Georgia, the FDIC said at the time.