FMS Wertmanagement sells US real estate portfolio with a nominal value of USD 1.2 billion

The German federal government’s winding-up institution FMS Wertmanagement has substantially reduced the remainder of its US real estate position to USD 0.8 billion due to the sale of a large US commercial real estate financing portfolio with a nominal value of USD 1.2 billion. FMS Wertmanagement was founded in 2010 to take over risk positions and operations from HRE Group.

The loan portfolio, which was sold in a strictly controlled bidding process, consisted of a total of 15 transactions collateralised by office buildings, shopping centres and hotels in various metropolitan areas in the United States.

The portfolio is mostly made up of performing loans. FMS Wertmanagement made the sale to achieve the larger than planned wind up by taking advantage of the currently favourable market conditions in the United States featuring strong liquidity and heightened investor interest. The sale was preceded by an extensive and highly competitive bidding process arranged and successfully carried out by FMS Wertmanagement's service entity in conjunction with US broker CBRE.

"We were able to leverage this favourable market window primarily thanks to excellent work by our real estate experts at FMS Wertmanagement Servicegesellschaft and in the Commercial Real Estate unit and are extremely pleased with the result," says FMS Wertmanagement's Executive Board Spokesman Dr. Christian Bluhm. "We want to continue to take advantage of opportunities like this when they present themselves to accomplish our mission of winding up this portfolio while maximising value."

FMS Wertmanagement was founded in 2010 with the aim of winding up the risk positions and operations that were transferred to the company from the Hypo Real Estate Group (HRE Group) effective 1 October 2010. As a financially independent entity under public law, FMS Wertmanagement defines the best possible wind-up strategies in each case and implements them based on the following maxim: seize opportunities for generating income and minimise losses. FMS Wertmanagement is supervised by the Federal Agency for Financial Market Stabilisation (FMSA).

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