Société Générale markets €2bn global loans portfolio

Performing loans disposal is up next after ongoing French debt sale

Société Générale has put more of its global property loan book on the market. The French bank, which has withdrawn from new real estate lending, is marketing a global portfolio containing performing loans in Europe and Asia with a par value of around €2bn.

The bank has already attracted strong interest from private equity groups and banks for a smaller portfolio of about 25 French and German real estate non-performing loans.

Blackstone, Starwood, Lone Star, Fortress and Deutsche Bank are expected to make final bids on the smaller portfolio this week. The loans have a nominal value of €500m.

Morgan Stanley is also selling some loans, in Spain. Market sources say they have been shown three loans with a par value of €120m, which are likely to be sold at a deep discount. Buyers are expecting more Spanish loans to come onto the market soon with Eurohypo tipped as a likely seller.

Lone Star has bought part  of the Excalibur portfolio of debt which the Bundesbank  is selling. CoStar News reported that the private equity group picked up the €430.4m Cerep III loan for €279.28m.

The loan was part of the €1.1bn Windermere XIV, the last securitisation Lehman Brothers put together at the time when the CMBS market was shutting down and which  it could not sell.

Lehman sold almost €3bn  of loans, including many in Windermere XIV and others that had been intended for securistisation, to the European Central Bank in May 2008 in a bid to raise funds. The assets have been managed by the Bundesbank since Lehman Brothers’ bankruptcy.