Commercial Real Estate Direct Staff Report

The $554.4 million that a team led by Starwood Capital Group paid for a 40 percent stake in a portfolio of assets from the failed Corus Bank was 23.2 percent greater than the second highest offer the FDIC received for it.

In total, FDIC received offers for the 102-loan portfolio from six other investor groups, according to documents recently made available by the agency. Those included Beal Bank of Dallas; Crescent Heights Inc. of Miami; a venture led by Kingston Management Services of Idaho Falls, Idaho; CIM Group of Los Angeles, and a venture of Westbrook Real Estate Partners and BlackRock Inc. A team led by an entity that FDIC identified only as ICDJ also made an offer.

The cover, or second-place bid, for the equity stake in the portfolio was $450 million. Starwood's team includes TPG Capital, Perry Capital and WLR LeFrak. The portfolio was comprised of 102 loans backed primarily by condominiums and condo-construction projects.

The other offers received by FDIC ranged from $262.3 million to $442.4 million, with an average offer of $369 million and median offer of $378 million.

Besides retaining a 60 percent equity stake, FDIC provided $1.39 billion of financing with a zero coupon and three-year term as well as a $1 billion working-capital facility. In total, the transaction valued the portfolio at $2.77 billion, or 61.6 percent of the portfolio's face value.

Comments? E-mail Orest Mandzy or call him at (215) 504-2860, Ext. 211.