New York City based Signature Bank, one of the top lenders of commercial real estate loans in NYC was seized by federal regulators on March 12, 2023. This seizure followed the collapse of California based Silvergate Bank on March 8th and Silicon Valley Bank on March 10th.
Signature Bank had approximately $110B in assets and $88B in deposits prior to it's collapse.
Real Estate giant Newmark's Adam Spies, Doug Harmon, Dustin Stolly, Jordan Roeschlaub and Josh Howley, as FDIC representatives are leading the sale.
The bulk of Signature loans approximately $15B of $20B went for multi family properties, according to data from Maverick Real Estate Partners.
According to George Klett, former chairman of Signature Banks commercial real estate committee “many of the loans will be sold below market value because they were prior to the Feds interest rate increase.” The loans will be eventually bought at a discount.
Newmark now has the job of selling these Signature loans.
According to The Commercial Observer, commercial real estate expert journalists, multiple bids for the real estate loans came in below par.
Undoubtedly, with such a huge influx of assets for sale will reverberate in NYC and across the country for other loan valuations as investors look for deals. In a report 1st made by The Wall Street Journal the commercial property market is likely to see ripple effects from the sale of a loan book this large, at a time when property values are already being squeezed.
To be continued...
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