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Wells Fargo, U.S. Bank to buy $750M loan portfolio

  • Article by: JENNIFER BJORHUS
  • Star Tribune
  • April 25, 2012 - 9:43 PM

U.S. businesses and financial companies continue to snap up assets as European lenders, looking to raise capital, unload them.

In the latest deal, Eurohypo, a unit of German lender Commerzbank AG, has reached an agreement to sell a $750 million portfolio of performing loans backed by U.S. commercial real estate to a team of Wells Fargo & Co. and Blackstone Group, and to U.S. Bancorp, according to a person familiar with the deal.

The Wells Fargo-Blackstone team has agreed to buy the bulk of the portfolio from Eurohypo -- a group of loans with a face value of $560 million tied to a variety of commercial properties, including the Frank Gehry-designed Beekman Tower apartments in Manhattan.

Minneapolis-based U.S. Bancorp has agreed to buy one loan from the Eurohypo bundle with a face value of $180 million. It's backed by a group of malls, including the Mayfair Mall in Wauwatosa, Wis., all owned by mall operator General Growth Properties Inc.

Neither Wells Fargo, based in San Francisco, nor Minneapolis-based U.S. Bancorp would comment on the sale. A spokeswoman for Eurohypo in Germany said it doesn't comment on deals until they close.

The deal was also reported Wednesday by the Wall Street Journal, citing unnamed sources.

Last year Wells Fargo bought $3.3 billion in loans backed by U.S. commercial property from Ireland's nationalized Anglo Irish Bank. In February it completed its acquisition of London-based asset lender Burdale Financial Holdings, as well as the portfolio of Burdale Capital Finance Inc., from Bank of Ireland.

David Tobin, principal at loan-sale advisory firm Mission Capital Advisors in New York, said U.S. lenders are ahead of Europe in digging out from their financial crisis because they've been doing debt sales since 2008.

"Europe has largely held off from doing that," Tobin said.

Jennifer Bjorhus • 612-673-4683

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