Kennedy Wilson has established a €2bn formal tie-up with Deutsche Bank after working with it on a number of loan deals.
The US investment and asset management firm has entered a framework agreement with the German bank through which they will buy up to €2bn of distressed European loans.
The partners will target performing, sub-performing and non-performing loans secured by commercial and residential real estate in Europe, with a focus on the UK and Ireland.
KW will potentially act as the asset manager and/or master servicer in respect of assets purchased under the framework, and would co-invest with its partner along with other potential investors.
The framework does not create a binding legal agreement between the parties, and the structure of any transaction under it will be agreed on a case-by-case basis.
The announcement comes as the partners submitted a first round bid for Allied Irish Bank’s £397m Project Pivot non performing loan portfolio.
Other parties in the frame for the 115-strong portfolio include Cerberus Capital Management, Blackstone, Lone Star, Starwood Capital, Goldman Sachs Whitehall Funds, Chenavari and Forum Partners.
Kennedy Wilson and Deutsche Bank won their first joint venture loan portfolio last autumn, buying the Bank of Ireland £1.1bn UK loan portfolio in two tranches.
It is also working with Deutsche Bank to buy Lloyds’ Project Prince portfolio of €360m Irish loans, and is shortlisted for the Lloyds Project Harrogate portfolio of £625m UK loans in partnership with Deutsche.
