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IPE special report May 2018

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Ireland's NAMA offloads Irish loan portfolio to Starwood

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  • Ireland's NAMA offloads Irish loan portfolio to Starwood

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IRELAND – The National Asset Management Agency (NAMA), Ireland's bad bank, has sold a domestic loan portfolio initially valued at €800m to Starwood Capital Group.

The sale will see a joint venture established, 80% owned by a consortium consisting of Starwood, Key Capital Real Estate and Catalyst Capital, with NAMA owner of the remaining 20% stake.

The agency said it would provide vendor finance to the joint venture, noting that the 60% loan-to-value loan would carry an unspecified "commercial" interest rate and be repaid within five years.

NAMA chief executive Brendan McDonagh praised the sale.

"NAMA is very happy with the successful outcome of the loan sale process, and we welcome Starwood to partner with us in resolving the portfolio," he said.

In a statement, NAMA repeatedly stressed that the transaction, which was first discussed with more than 60 bidders in February and progressed to exclusive talks with Starwood in April, demonstrated the recovery in the Irish commercial market.

CBRE recently noted that prime commercial properties in recovering European countries would outperform holdings in safe-haven regions, with the company predicting investors would "come off the fence" and invest in Dublin.

Jeffrey Dishner, senior managing director at Starwood, said the deal came as part of the company's strategy to buy up non-performing loans and demonstrated its ability to "work in partnership with financial institutions throughout the world to successfully manage the portfolios".

Although a sale price was not disclosed, Irish broadcaster RTE said it believed the loan portfolio was sold for around one-quarter of its initial value.

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