Oaktree Capital Management has made it on to a four-strong shortlist competing to buy Lloyds Banking Group’s £625m Project Harrogate loan portfolio.
The investment manager has been selected alongside private equity firms Lone Star and Cerberus Capital Management, and a joint bid from Kennedy Wilson and Deutsche Bank for the ‘Project Royal II’ sale.
It is the latest push into the UK real estate market by the Los Angeles-based firm, which has around $5bn of real estate assets under management.
Earlier this year it provided 80% of the equity for Capital & Regional’s £130m purchase of the Kingfisher mall in Redditch, Worcestershire.
Prior to that it had set up Knightsbridge Student Housing with former Victoria Hall head Bob Crompton, and it also owns a stake in estate agency chain Countrywide.
Last April, Ian Coull, former Segro chief executive, became a senior adviser to the firm.
Oaktree closed the $1.25bn Oaktree Real Estate Opportunities Fund V earlier this year.
Lloyds has asked the shortlisted parties to submit second round bids with details of loan financing for their proposals in the first week of August.
Project Harrogate comprises around 70 loans secured against slightly fewer than 60 secondary properties throughout the UK, owned by around 25 different borrowers.
It is the third significant portfolio of non-performing loans to be put up for sale by the bank.
In December, it sold the £900m Project Royal portfolio to Lone Star, and last month offloaded a €360m Irish non-performing loan to Kennedy Wilson and Deutsche Bank.
JP Morgan is advising on the sale.
bridget.oconnell@estatesgazette.com
