Purchase of Lend Lease’s Real Estate Investments division, which manages ¬4.1bn in Europe, would represent a move into a new market for either GE Capital or GMAC
Lend Lease Corporation is understood to have shortlisted GE Capital and the General Motors Acceptance Corporation (GMAC) as potential buyers for its Real Estate Investments division (LLREI).
LLREI, which has ¬50.2bn under management worldwide, is undertaking a strategic review of its $1.5bn business, which is expected to be complete by the end of the year. LLREI has ¬4.1bn under management in Europe.
An acquisition of LLREI by either GE Capital or GMAC would signal a change in strategy for the companies, as neither are active in the fund management arena. However, both companies are understood to be keen to acquire the significant portfolio of mortgages held by LLREI in the US.
LLREI includes a commercial credit division, which originates loans on behalf of institutional clients; the mortgage capital group, which originates and manages multi-family mortgages; and the Agri-Business, which helps agricultural producers with long-term property finance needs. It also owns CapMark Services, one of the largest loan servicers in the US, which manages $65.5bn in loans. Merrill Lynch in New York is advising Lend Lease.
GE Capital is the stronger presence in Europe, with assets of $4.9bn. On the property side, GMAC has moved into lending in the European market. In its first transaction, GMAC Commercial Mortgages supplied the financing for the purchase of a £150m central London portfolio on behalf of a client of Investream, run by Maurice Golker and Mark Morris.
