Morgan Stanley Obtains $700M Property Loan From Blackstone Venture

Morgan Stanley MS has entered into a deal to acquire around $700 million of property loans from the failed Signature Bank through a consortium.

The consortium involves Blackstone Inc. BX, Canada Pension Plan Investment Board, and Rialto Capital.

The transaction, marks a significant move in the commercial-property finance arena, according to a report from Bloomberg.

Jones Lang LaSalle Inc JLL advised on the sale. Representatives for Blackstone, CPPIB, and Morgan Stanley opted not to provide comments.

Last year, Blackstone and associates secured a share in a partnership with the Federal Deposit Insurance Corp. (FDIC), which held about $17 billion worth of Signature property loans.

However, the FDIC has yet to issue a statement regarding Morgan Stanley’s recent acquisition.

Initially, the consortium explored the possibility of selling a portion of the loan portfolio, specifically about $1.8 billion in performing loans, primarily for apartment buildings.

The fate of the remaining portion of these loans remains uncertain. The sale of Signature property loans has attracted investor attention amid a sluggish market for commercial-property transactions, Bloomberg writes.

Last year U.S. regulators shut down Signature Bank, the third financial institution to be shut after Silicon Valley Bank and Silvergate Capital Corp.

With rising borrowing costs and declining valuations, transactions like the Signature loan sales offer insights into the true value of properties and their associated debts.

Price Action: MS shares are trading higher by 0.96% at $100.33 at the last check on Wednesday.

Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

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