Colony Starwood Homes has sold a portfolio of 1,675 nonperforming loans, as it winds down its business in the space.

The portfolio was sold to an affiliate of Starwood Capital Group for $265 million. The book value of the portfolio was roughly $259 million as of June 30.

Through this sale, the Scottsdale, Ariz.-based real estate investment trust has nearly completely exited the NPL space in line with its strategic plan.

Colony Starwood conducts its NPL operations through a joint venture with Prime Asset Fund VI. The sale followed a broadly marketed auction process, for which Credit Suisse Securities served as sale advisor.

Following the sale, Colony Starwood indirectly owns approximately $120 million in book value of assets, most of which is REO, through its joint venture. The REIT plans to sell the remaining joint venture assets and repay all associated debt by the end of the first half of 2017.

Colony Starwood also plans to use the net proceeds generated from the wind-down of the NPL business for general corporate purposes, including the acquisition and renovation of single-family rental homes.

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