Perella Weinberg JV buys $540m portfolio

A venture led by the New York-based investment firm has purchased a portfolio of nonperforming loans and real estate owned from Banco Popular de Puerto Rico.

A joint venture between New York-based firms Perella Weinberg Partners and Caribbean Property Group (CPG) has purchased a portfolio of nonperforming commercial and constructions loans and commercial and single-family real estate from Banco Popular de Puerto Rico. 

According to a statement, the portfolio has a combined unpaid principal balance on loans and appraised value of other real estate owned (REO) of approximately $995 million and a book value of approximately $540 million. Under the terms of the deal, Banco Popular will retain a 24.9 percent equity interest in the portfolio. 

Perella Weinberg bought its stake through its Asset Based Value Strategy, which currently manages in excess of $2.1 billion in equity through a number of investment vehicles raised since its inception in 2008. 

Through this transaction, Banco Popular will provide an advance facility of approximately $35 million to cover cost-to-complete amounts and expenses of certain projects. In addition, the bank will provide $30 million through a working capital line of credit to fund certain operating expenses of the asset-owning borrower. In turn, Banco Popular will receive $99 million in cash and a note for $182 million as seller financing.

Mark Lipschutz, chief executive officer of CPG, said in a statement that “this was a very complex deal” that involved more than “2,000 nonperforming loans” and nearly “1,000 REO properties.” This is the third transaction completed by the venture between Perella Weinberg and CPG.

Since its founding in 1998, CPG has acquired, developed and redeveloped approximately $2.2 billion of real estate in the Caribbean and Central America. In addition to New York, the firm has offices in West Palm Beach, Florida, and San Juan, Puerto Rico.