The Federal Deposit Insurance Corp. said Thursday that a partnership between an unnamed minority-owned business and Oaktree Capital Management based in Los Angeles, will pay $23.9 million in cash for 25% of a company formed to own 93 commercial real estate loans the FDIC inherited from Tennessee Commerce Bank in Franklin, Tenn.
Regulators seized Tennessee Commerce in January after the bank became critically undercapitalized. The loans have a combined unpaid balance of roughly $166.2 million, secured mostly by land and other collateral in Tennessee, according to the FDIC.
The winning team was among ten groups who bid for the assets, which the FDIC sold as part of its program for small investors. The sale was the FDIC's fourth under the program, which aims to give smaller investors, including minority- and women-owned business, opportunities to buy assets from failed banks.
The FDIC forms partnerships with winning bidders, who buy a minority stake in the venture, manage the assets, and share proportionally in any appreciation.
Oaktree, which managed roughly $79 billion in assets at the end of June, declined to comment. The FDIC did not immediately identify the minority-owned business.
In September, Oaktree brought to market its first CMBS deal called Oaktree Real Estate Investments/Sabal, Series 2012-LV1 worth $195 million, according to a Fitch Ratings presale..
The notes are secured by all of the issuers' assets, which indirectly comprise 615 performing and nonperforming real estate secured loans, 22 non-real estate secured loans, 49 unsecured loans, and 78 real-estate-owned properties bought at acquisition or via foreclosure, the Fitch presale stated.
The collateral comprises most nonperforming loans, performing loans, and real estate owned (REO) that the sponsor bought at a considerable discount to the unpaid principal balance, according the Fitch presale report.