Wells Fargo set to sell €123m German loan portfolios

Wells Fargo has awarded broker Eastdil Secured the mandate to sell two German multi-family housing loans with a €123m face value. The US bank is seeking offers for a €80.1m performing loan that was lent to Forum Partners in 2006, and a €42.9m non- performing loan that is due to mature next year.

The larger loan is backed by 10 east German properties, expires in 2016 and bears a fixed interest rate of 4.81% and an amortisation rate of 1.25%. It has an interest cover ratio of 1.26x, while debt must be serviced by 1x. The 141,619m2 portfolio of 2,808 flats is 89.4% let, and generates an annual rental income of €8.12m.

The defaulted loan is secured against six west German mixed-use assets producing rental income of €3.64m. With a higher set interest rate of 5.82% but a lower amortisa-tion rate of 1%, a buyer would also get less protection because the interest cover ratio is 0.99% and the debt service coverage ratio 0.63%. US bank Citi is also under-stood to be selling debt.