December 21, 2023 4:00 PM
Newmark Group, Inc. (Nasdaq: NMRK) (“Newmark”), a leading commercial real estate advisor and service provider to large institutional investors, global corporations, and other owners and occupiers, completed its role as exclusive financial advisor to the Federal Deposit Insurance Corporation (“FDIC”) on the sale of approximately $60 billion of loans formerly owned by Signature Bank. Newmark Co-Heads of U.S. Capital Markets Doug Harmon and Adam Spies led a dedicated team that represented and advised the FDIC in six complex transactions of more than 5,000 real estate loans encompassing housing, retail, office, mixed-use and bridge financing loans held by Signature Bridge Bank, N.A. Co-Head of U.S. Capital Markets Robert Griffin, Executive Managing Director John Howley and Managing Director John Daniels provided additional support in the transactions. Newmark expects to continue providing services to the FDIC in various capacities.
“In order to sell such a complex and significant portfolio and deliver the best possible value for all shareholders, the FDIC required the comprehensive market knowledge and strong industry connections that only Newmark can offer,” said Harmon. “We are pleased to have served as the strategic advisor to the agency for these transactions, which included record-setting all-cash transactions as well as several deals that further preserve affordable and equitable housing.”
As the largest real estate loan sale in United States history, the marketing and execution of transacting these portfolios took place over six months and included the sale of the:
- $9.0 billion loan portfolio backed by rent-stabilized properties to Santander Bank (NYSE: SAN), consisting of three pools of rent-controlled and rent-stabilized loans that cover nearly 2,000 multifamily properties across New York State, totaling over56,000 individual residences across 1,370 loans. The transaction was completed on December 20, 2023.
- $16.8 billion commercial real estate loan portfolio to a Blackstone-led joint venture comprising Blackstone Real Estate Debt Strategies (“BREDS”), Blackstone Real Estate Income Trust, Inc. (“BREIT”), Canada Pension Plan Investment Board (“CPP Investments”) and funds affiliated with Rialto Capital (“Rialto”). The portfolio comprised 2,600 loans spanning retail, market-rate multifamily and office properties primarily in the New York City area, with approximately 90 percent being fixed rate. The transaction was completed on December 20, 2023.
- $5.8 billion package of rent-stabilized or rent-controlled multifamily loans to Community Preservation Corporation (“CPC”), Related Fund Management (“Related”) and Neighborhood Restore, a newly formed venture. The portfolio consisted of more than 870 loans secured by over 1,100 New York City residential properties and nearly 59,000 individual units. Having invested $14.3 billion in multifamily properties, financed 225,000 units and housed 1.1 million people, CPC is one of the country’s largest Community Development Financial Institutions exclusively focused on multifamily housing in low-income areas. The transaction was completed on December 15, 2023
- All-cash transaction of two loan portfolios to Axos Bank, a subsidiary of Axos Financial, Inc. (NYSE: AX), involving an aggregate unpaid principal balance of $1.25 billion of commercial real estate and multifamily loans, which were procured at approximately 63% of the par value. The transaction was completed on December 14, 2023.
- $15.4 billion loan portfolio to Goldman Sachs Group Inc. (NYSE: GS), comprised of $8.96 billion in funded loans and more than $6.44 billion in additional commitments in an all-cash transaction, achieving pricing north of 99 cents on the dollar. The transaction was completed on October 3, 2023.
- $16.6 billion loan portfolio to PNC Bank (NYSE: PNC), comprised of $9.02 billion in funded loans and $7.58 billion in additional commitments in an all-cash transaction, achieving pricing north of 99 cents on the dollar. The transaction was completed on October 3, 2023.
Harmon concluded, “Newmark is committed to delivering exceptional outcomes and driving long-term prosperity, and our team’s proven ability to guide clients through even the most complex of situations sets Newmark apart in the global CRE industry. We are humbled to have been part of what is easily the largest transaction of its kind in history.”
About Newmark
Newmark Group, Inc. (Nasdaq: NMRK), together with its subsidiaries (“Newmark”), is a world leader in commercial real estate, seamlessly powering every phase of the property life cycle. Newmark’s comprehensive suite of services and products is uniquely tailored to each client, from owners to occupiers, investors to founders, and startups to blue-chip companies. Combining the platform’s global reach with market intelligence in both established and emerging property markets, Newmark provides superior service to clients across the industry spectrum. For the year ended December 31, 2023, Newmark generated revenues of approximately $2.5 billion. As of March 31, 2024, Newmark’s company-owned offices, together with its business partners, operate from approximately 170 offices with 7,600 professionals around the world. To learn more, visit nmrk.com or follow @newmark.
Discussion of Forward-Looking Statements about Newmark
Statements in this document regarding Newmark that are not historical facts are “forward-looking statements” that involve risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements. These include statements about the Company’s business, results, financial position, liquidity, and outlook, which may constitute forward-looking statements and are subject to the risk that the actual impact may differ, possibly materially, from what is currently expected. Except as required by law, Newmark undertakes no obligation to update any forward-looking statements. For a discussion of additional risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see Newmark’s Securities and Exchange Commission filings, including, but not limited to, the risk factors and Special Note on Forward-Looking Information set forth in these filings and any updates to such risk factors and Special Note on Forward-Looking Information contained in subsequent reports on Form 10-K, Form 10-Q or Form 8-K.
[1] The book value of the overall loan portfolio was approximately $60 billion when Newmark was retained as an advisor by the FDIC and approximately $53 billion when the Company began marketing the loans, while the completed transactions had a combined notional value of $39.5 billion. For more information, please see various announcements, press releases, and other information on the FDIC website, including “FDIC Announces Upcoming Sale of the Loan Portfolio from the Former Signature Bank, New York, New York”, “SIGF-23 Sale Announcement $18.5 Billion All Cash Loan Sale”, “SIGCRE-23 Sale Announcement $33.22 Billion Commercial Real Estate Loan Portfolio”, “FDIC Signature Bank Receivership Sells 20 Percent Equity Interest in Entity Holding $9 Billion Rent-Stabilized / Rent-Controlled Multifamily Loans”, “FDIC Signature Bridge Bank Receivership Sells Five Percent Equity Interest in Entities Holding $5.8 Billion of Rent-Stabilized / Rent-Controlled Multifamily Loans”, and “FDIC Signature Bridge Bank Receivership Sells 20 Percent Equity Interest in Entity Holding $16.8 Billion of Commercial Real Estate Loans.”