FDIC Signature Bridge Bank Receivership Sells Five Percent Equity Interest in Entities Holding $5.8 Billion of Rent-Stabilized / Rent-Controlled Multifamily Loans
WASHINGTON – The Federal Deposit Insurance Corporation (FDIC), as Receiver of Signature Bridge Bank, N.A. (FDIC-Receiver), today completed two of several transactions following the marketing of the $33 billion Commercial Real Estate (CRE) loan portfolio retained in receivership after the failure of Signature Bank, New York, New York.
In a pair of transactions, the FDIC-Receiver established two newly formed ventures (Ventures), and sold a five percent equity interest in each Venture to Community Preservation Corporation (CPC). CPC is a nonprofit multifamily finance company that was founded in 1974 to provide financial resources to stabilize and revitalize underserved communities. The FDIC-Receiver retained a 95 percent equity interest in each Venture. The FDIC-Receiver contributed to the Ventures a total of approximately $5.8 billion of loans collateralized by rent-stabilized or rent-controlled multifamily properties.[1]
Among other factors, the FDIC-Receiver has a statutory obligation to maximize the preservation of the availability and affordability of residential real property for low- and moderate-income individuals. The terms of each transaction include requirements that facilitate the financial and physical preservation of underlying collateral. CPC will be responsible for the management, servicing and liquidation of each Ventures’ respective assets. CPC will also be required to manage the portfolios in accordance with the terms of the transactions, subject to comprehensive monitoring and oversight by the FDIC-Receiver.
The FDIC-Receiver announced the start of the marketing process in September 2023. The transactions were marketed on a competitive basis, with a seven-week due diligence period for qualified parties. The FDIC-Receiver offered bidding on a five percent equity interest in each Venture. The FDIC-Receiver carefully considered the FDIC-Receiver’s statutory obligations in the selection of the winning bidder.
For this portfolio, the FDIC-Receiver engaged with New York City and New York State housing authorities and government agencies, as well as community-based organizations, to obtain their input and provide information on the FDIC-Receiver’s efforts as the FDIC-Receiver developed its marketing and disposition strategy.
The FDIC-Receiver expects to announce soon additional results for the rent-stabilized or rent-controlled multifamily loan portfolio transactions.
Read more about the FDIC-Receiver’s asset dispositions.
[1] Sig-23 Private Owner LLC (Sig-23), an entity indirectly controlled by CPC, paid $129 million for a five percent equity interest in SIG RCRS C MF 2023 Venture LLC. Sig-23 Private Owner II LLC (Sig-23 II), an entity also indirectly controlled by CPC, paid $42 million for a five percent equity interest in SIG RCRS D MF 2023 Venture LLC. Each transaction established a newly formed entity, wholly owned by the Receiver.
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FDIC: PR-106-2023
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