Simpson Thacher represented Blackstone Real Estate Debt Strategies (“BREDS”) and Blackstone Real Estate Income Trust (“BREIT”) in connection with a newly formed joint venture with the Federal Deposit Insurance Corporation (“FDIC”). Together with Canada Pension Plan Investment Board through its subsidiary CPPIB Credit Investments III Inc., and funds affiliated with Rialto Capital, BREDS and BREIT acquired a 20% equity stake with 50% financing for $1.2 billion in the venture which holds a $16.8 billion senior mortgage loan portfolio retained in receivership following the failure of Signature Bank. The FDIC is maintaining an 80% ownership stake in the portfolio.
The commercial real estate loan portfolio comprises more than 2,600 first mortgage loans on retail, market rate multifamily and office properties primarily located in the New York metropolitan area. Blackstone will be the lead asset manager of the portfolio and Rialto Capital will act as the loan servicer and operating partner.
The Simpson Thacher team for this transaction included: Lee Meyerson, Michael Chao, Theresa Scharff and Jacob Snider (M&A); Gregory Ressa, Anthony King, Whitney Salinas, Leanne Welds, Alexa Effron and Dorian Ledbetter (Real Estate); Jennifer Levitt, Thomas Howland, Emma Light and Sophie Kim (Banking and Credit); Peter Gilman, Matthew Leighton, Nick Brown, Joshua Katz, Nikaury Payano and Michael Burnstein (Funds); and Jonathan Goldstein, Jasmine Hay and Tova Pfeffer (Tax).