Colony, Cogsville Win FDIC Asset Sale

(Reuters) – A $1.85 billion portfolio of distressed commercial real-estate loans auctioned by the U.S. Federal Deposit Insurance Corp has been won by a partnership between Tom Barrack’s Colony Capital LLC and investment firm Cogsville Group LLC, the Wall Street Journal said.

The deal, expected to be made public by the FDIC on Wednesday, is the second-largest bulk sale of commercial-property debt under a public-private partnership, the paper said.

The FDIC will retain 60 percent of the assets, while Colony Capital and New York-based Cogsville Group LLC have agreed to pay 59 cents on the dollar, or $445 million, for a 40 percent equity stake — with an upfront cash payment of $218 million, the Journal said.

Cogsville, an African-American-owned firm, contributed $16 million for a 7 percent stake in the portfolio, consisting of 1,660 commercial-property loans held by 22 now-defunct banks, including Community Bank of Nevada, First Bank of Beverly Hills and New Frontier Bank, the paper said. (Reporting by Antonita Madonna Devotta in Bangalore, editing by Gerald E. McCormick)