Blackstone Leads The Pack In Signature Bank's Massive Property Loan Sale

Blackstone Inc. BX is reportedly the lead contender in the purchase of a $17 billion portfolio of commercial-property loans from the Federal Deposit Insurance Corporation’s sale of Signature Bank's debt. This comes as regulators attempt to offload the fallen bank's debts.

According to Bloomberg, insiders familiar with the matter disclosed that FDIC officials are in the final stages of discussions, favoring Blackstone's bid because it comes with the lowest costs.

The bank, which was seized by regulators in March, has been marketing loans backed by retail, industrial, office, and apartment buildings. The exact terms of the deal are still under discussion and could change.

It should be noted that the deal is not yet sealed - there's still a possibility of another bidder winning or the loan pool being split among different suitors.

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The FDIC has been trying to sell approximately $33 billion of Signature’s real estate loans since the bank's collapse earlier this year. The bank was a major lender to apartment landlords in New York City, but Blackstone's deal does not include loans backing buildings with rent-stabilized or rent-controlled units.

Presently, commercial property proprietors face mounting pressure caused by escalating borrowing expenses, which are diminishing property worth and hindering transactions. As a result, the market has been largely inactive, with investors closely watching the Signature sale for better pricing indications.

The sale has attracted finance companies like Starwood Capital Group and Brookfield Asset Management Ltd. Many companies reportedly planned to partner with other firms for offers.

In recent trading, Blackstone Inc. shares were down by 0.5%.

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