Marathon wins Project Aberdonia paying €280m

Marathon Asset Management has won the Project Aberdonia, the Lloyds Banking Group Continental European commercial property loan portfolio, paying €280m.

Marathon AM (correct logo)The €280m price, which translates to £235m, reflects a 52.5% discount over the €590m (£494m) nominal value and a €1m premium on the €279m desktop valuation prepared by CBRE for the loan sale.

Underbidders in the final round comprised Cerberus, Starwood Capital and BAML, as first reported by CoStar News.

Marathon, which also won Lloyds’ Project Chamonix, another Continental property loan portfolio for which the sponsor for around 80% of the underlying real estate was Marcol Group, early last year.

The sole borrower within Aberdonia is Industrial Securities, who parent company is Marcol Group.

Lloyds announced this sale of the Aberdonia loan portfolio on the Stock Exchange this morning, stating that the portfolio of European commercial real estate loans were sold to “MELF S.à r.l, an entity affiliated with Marathon Asset Management LP, for a cash consideration of approximately €280m , or approximately £235m at current exchange rates”.

In the year to 31 December, the Aberdonia loans incurred a loss of £54m.

The final Aberdonia loan pool has marginally reduced since the loan portfolio was assembled, initially comprising one €526m senior loan and one €63m mezzanine facility extended by HBOS to Industrial Securities, the pan-European industrial investment manager and subsidiary of Marcol Group.

In addition there are two loans, originated in local Polish currency, against two properties equivalent in euro terms to approximately €10.4m for the senior loan and €0.7m for the mezzanine loan.

Project Aberdonia’s original €600.1m aggregate debt, which reduced to €590m, is secured by 82 properties, predominantly in France and Germany, valued at €279m by CBRE immediately prior to the loan portfolio sale, implying a portfolio LTV of 215.1%.

CoStar News understands that first round pricing on Project Aberdonia came in at around €260m.

Marathon will now seek to execute an agreed asset management and disposal plan alongside Industrial Securities in a consensual work out strategy.

UBS is selling Project Aberdonia for Lloyds.

Marathon is the notable bidder to make the shortlist, given that the hedge fund won Lloyds’ Project Chamonix, another Continental property loan portfolio, one year ago.

CoStar News reported on the details of Project Aberdonia two weeks ago, which can be seen here (which includes an overview of the real estate portfolio by geography and CBRE valuation).

About CoStar News

Finance Editor, CoStar News
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