Royal Bank of Scotland has sold two further non-performing loan portfolios secured against commercial properties in the Republic of Ireland and the bank’s final clean-up trade of Northern Irish assets.
Sankaty Advisors, the affiliate of Bain Capital which has been assembling a portfolio of mid-range hotels through a series of distressed loan purchases, has acquired Project Coney from RBS subsidiary, Ulster Bank.
According to the Irish Times, Project Coney comprised loans secured by 36 hotels, 66 pubs, 23 commercial units, 49 residential units, 56 development and agricultural sites, and a nursing home. Dublin accounts for about 40 per cent of the market value of the loans.
The outstanding balance was €465m, while the latest market value of the property portfolio at €187m. In addition, the borrowers have drawn overdrafts totalling €14m.
CoStar News understands that RBS and Sankaty Advisors completed the deal yesterday morning. Cerberus Capital Management was the underbidder.
Separately, RBS confirmed the sale of Project Rathlin, a mixed portfolio, yesterday to Cerberus Capital Management for £205m, in a final clean up trade of the bank’s Northern Irish assets contained in RBS Capital Resolution (RCR).
Project Rathlin had an unpaid balance plus swap liabilities of £1.4bn, implying a discount to gross liabilities of circa 85%.
The loans generated a loss in the region of approximately £16m in the year to 31 December 2014. The disposal of the portfolio is expected to result in a loss of approximately £5m after costs associated with the transaction.
In a statement, RBS said: “The disposal of this portfolio represents the final material transaction for RCR in Northern Ireland.”
Completion is expected in June 2015.
Cerberus’ Project Rathlin win follows the earlier £1.1bn (€1.38bn) Project Aran trade with RBS in mid-December, which had an unpaid loan balance of €5.6bn and gross liabilities of £4.8bn (€6bn).
In April 2014, Cerberus also won NAMA’s entire loan book of Northern Irish borrowers, paying around £1.2bn for the £4.5bn Project Eagle loan portfolio, which all together cement Cerberus as the largest acquirer of legacy Northern Irish commercial properties through defaulted loans.