Cerberus Capital Management is leading a shortlist of bidders for Lloyds’ next major loan sale as it flips the first asset from its £325m Project Thames loan portfolio.
The US private equity firm is understood to have been selected to go through to the second round of bids for the €1.5bn (£1.3bn) European non-performing loan portfolio sale, codenamed Project Hampton, alongside Deutsche Bank. Apollo, Lone Star and Blackstone are also in the running.
The portfolio has been divided into three tranches – projects Alpha, Bravo and Charlie – but ?it is understood that the shortlisted parties made offers for the entire lot.
It comprises roughly €700m of French and German loans, €600m in Scandinavian loans and €200m in Spanish loans.
Last month Cerberus won Lloyds’ €450m German NPL, dubbed Project Indie, and in May bought the £375m Project Thames debt portfolio from Lloyds. It is close to selling high-profile Thames asset the Brewery at 52 Chiswell Street, EC1, to leisure investor Mansford Real Estate for £33.5m. A deal reflecting a net initial yield of 8.5% is to close shortly.
Project Thames contained 167 assets valued at £466m, with Cerberus picking up the loans at a roughly 30% discount.
The largest asset in the portfolio is the 390,000 sq ft Capital building in Liverpool, which is expected to hit the market soon. Developer Downing handed back the keys in August.
Cerberus, which this week completed a final closing for its $1.4bn (£876m) third real estate fund, is also thought to have agreed a handful of discounted pay-off deals on some of the loans in the portfolios, which allow the original borrower to buy back the asset at a discount.
Lambert Smith Hampton is handling the workout of the Project Thames assets for Cerberus, having advised on the original portfolio purchase. Deloitte is advising Lloyds on the sale of Project Hampton.
Bridget.O’Connell@estatesgazette.com
Jack.Sidders@estatesgazette.com
