Starwood Waypoint Residential Trust has completed the USD101.3m purchase of a non-performing loan (NPL) pool from a money-centre bank.
The non-performing loan portfolio is comprised of 494 non-performing first lien mortgages representing approximately USD150.9m of unpaid principal balance (UPB) and USD158.2m of estimated broker price opinion (BPO) value.
The purchase price equates to 67.2 per cent of UPB and 64.0 per cent of BPO value.
The transaction was funded with proceeds from a USD350m warehouse credit facility with Deutsche Bank.
“We found the geography of this pool extremely attractive with roughly half of the loans located in two of our key target markets of California and Florida,” says Brendan Brogan, senior vice president at Starwood Capital Group. “This is an exciting opportunity, and is representative of the type of high-quality portfolio we are seeking to acquire.”
Gary Beasley, co-chief executive officer of Starwood Waypoint Residential Trust, says: “The closing of this credit facility, in addition to the USD500m line closed earlier this month, further improves our financial flexibility and ability to attractively finance our growth. This NPL pool acquisition evidences our continued commitment to making attractive investments in the single family residential sector which we believe will generate attractive risk-adjusted returns for shareholders. We will continue to leverage our industry-leading operating platform, proprietary technology and local market intelligence to acquire single-family homes and residential non-performing mortgage loans in order to create value.”
This represents the sixth NPL pool purchased by SWAY and its predecessor entities, which in aggregate represents a total purchase price of USD356.6m.
This purchase price represents approximately 52.7 per cent of the total UPB of USD676.6m and 63.9 per cent of the estimated total BPO value at the time of each purchase totalling USD557.8m.