DEAL OF THE DAY: Colony Capital, The Cogsville Group Invest in 1,600 Commercial Real Estate Loans Held by FDIC
Colony Capital LLC and The Cogsville Group LLC have closed on the purchase from the Federal Deposit Insurance Corp. (FDIC) of a $1.8 billion portfolio of more than 1,600 commercial real estate loans acquired by the FDIC as receiver of 21 failed financial institutions.
New York—Colony Capital LLC and The Cogsville Group LLC have closed on the purchase from the Federal Deposit Insurance Corp. (FDIC) of a $1.8 billion portfolio of more than 1,600 commercial real estate loans acquired by the FDIC as receiver of 21 failed financial institutions.
The transaction is the FDIC’s second-largest bulk sale of commercial-property debt under a public-private partnership to date and consists of both performing and non-performing loans in 41 states. The portfolio was acquired at approximately 59 percent of unpaid principal balance and the FDIC will retain a 60 percent stake in future proceeds.
Donald P. Cogsville, CEO of The Cogsville Group, says, “We are honored to partner with Colony in the FDIC’s structured asset sales program, which plays an important role in both resolving distressed real estate and returning the nation’s financial system to health.”
The Cogsville Group is a minority-owned private equity and advisory firm whose investment fund, Cogsville Capital Partners Fund I, LP, co-invests with institutional partners.
“We use this unique mix of internal and external resources to identify and analyze investment opportunities,” says Cogsville.
Colony Capital, an active owner of distressed loan portfolios since the 1990s, will oversee the day-to-day management of the portfolio.
“We are pleased to partner in this significant transaction with The Cogsville Group, which shares our enthusiasm for this asset class,” says Paul Fuhrman, Principal of Colony Capital.
Cogsville, a long-term veteran of structured finance and real estate, was involved in over $20 billion of transactions as an investment banker in the Global Leverage Finance Group at Merrill Lynch and as a corporate attorney at Skadden, Arps.
“The Cogsville Group has participated in the FDIC structured asset sales program from its inception and underwrote and bid on one-third of the assets sold to date. We believe this transaction will generate attractive returns for our investors and the FDIC, and similar portfolios will be a central focus of our broader investment activities” says Cogsville.
Daniel Rose, Chairman of Rose Associates, is an investor in The Cogsville Group. He said “this is an opportune time to create new real estate vehicles, and Mr. Cogsville is a dynamic and knowledgeable leader who can produce superior long-term returns for investors.”