US real estate lender Wells Fargo & Company has signed an agreement to buy Commerzbank’s Hypothekenbank Frankfurt’s UK commercial real estate portfolio.
The former Eurohypo loan book includes around £1.3bn of non-performing loans which will be sold to Lone Star Funds, with Wells Fargo providing the financing. The deal is expected to close in Q3 2013.
Wells Fargo Commercial Real Estate executive vice president Bill Vernon led the acquisition.
“Hypothekenbank Frankfurt’s 20-year history in London, their recognition as a market leader in the commercial real estate industry, and our similar approaches to building quality assets and providing outstanding client service all add up to a great strategic expansion opportunity for Wells Fargo’s UK commercial real estate business,” he said.
“This transaction, in combination with Wells Fargo’s long-standing real estate expertise, will help create a best-in-class commercial real estate platform in the UK,” he added.
Upon completion of the transaction, Wells Fargo will name Hypothekenbank Frankfurt industry veteran, Max Sinclair, as head of its London commercial real estate office.
In addition, Mike Acratopulo, Hypothekenbank Frankfurt’s managing director and head of origination, and a number of other Hypothekenbank Frankfurt employees are expected to become Wells Fargo team members, with most of those joining the London commercial real estate team.
Upon joining Wells Fargo, Sinclair will report to Chip Fedalen, executive vice-president and group head who oversees Wells Fargo’s UK commercial real estate operation and reports to Mark Myers, head of commercial real estate at Wells Fargo.
As part of the transaction, the Hypothekenbank Frankfurt office space at 90 Long Acre will become Wells Fargo’s new UK commercial real estate headquarters.
Myers said: “Given Wells Fargo’s position as the number one commercial real estate lender in the US and our recent expansion of commercial real estate services in the UK, this transaction is a significant investment in the future growth of our UK platform.
“Max’s deep industry expertise and knowledge of the UK market will add significant strength to our commercial real estate platform and we look forward to having him and the other outstanding Hypothekenbank Frankfurt team members join our Wells Fargo team in London.”
