Signature Bridge Bank Receivership Sells 5% Stake in $5.8B Rent-Stabilized Multifamily Loan Entities
FDIC Completes Sale of Stake in Rent-Stabilized Multifamily Loan Entities
The Federal Deposit Insurance Corporation (FDIC), as the Receiver of Signature Bridge Bank, N.A., announced the completion of a significant transaction involving a 5% equity interest sale in entities holding $5.8 billion worth of rent-stabilized and rent-controlled multifamily loans. The sale was in accordance with the FDIC’s statutory obligations to preserve the availability and affordability of residential real property for low- and moderate-income individuals.
Community Preservation Corporation (CPC) Acquires Stake in Ventures
As part of the transaction, the FDIC-Receiver established two newly formed ventures and sold a 5% equity interest in each venture to the Community Preservation Corporation (CPC). CPC is a nonprofit multifamily finance company that strives to stabilize and revitalize underserved communities. The FDIC-Receiver retained a 95% equity interest in each venture.
Preserving Affordable Housing
The ventures, established by the FDIC-Receiver, now hold approximately $5.8 billion worth of loans collateralized by rent-stabilized or rent-controlled multifamily properties. By partnering with CPC, a trusted organization with extensive experience in multifamily finance, the FDIC-Receiver aims to preserve the financial and physical integrity of the underlying collateral, ensuring the availability of affordable housing.
CPC’s Role in Asset Management
Community Preservation Corporation will be responsible for managing, servicing, and liquidating the assets of each venture. They will also oversee the portfolios in accordance with the terms of the transactions, subject to comprehensive monitoring and oversight by the FDIC-Receiver. This collaboration ensures that the ventures’ assets are managed efficiently and with a focus on the preservation of affordability.
Marketing and Due Diligence
The FDIC-Receiver initiated the marketing process for the rent-stabilized or rent-controlled multifamily loan portfolio in September 2023. The transactions were conducted on a competitive basis, with qualified parties given a seven-week due diligence period. Bids were accepted for a 5% equity interest in each venture. The FDIC-Receiver took into account its statutory obligations when selecting CPC as the winning bidder.
Collaboration with Housing Authorities and Community-Based Organizations
During the transaction process, the FDIC-Receiver engaged with New York City and New York State housing authorities, as well as government agencies and community-based organizations. Their input and information were sought to ensure that the FDIC-Receiver’s marketing and disposition strategy aligned with the goals of serving low- and moderate-income individuals and preserving affordable housing.
Looking Ahead
The FDIC-Receiver expects to announce additional results for the rent-stabilized or rent-controlled multifamily loan portfolio transactions in the near future. These transactions mark a significant step in preserving affordable housing and furthering the FDIC-Receiver’s commitment to the community.
Frequently Asked Questions
What is the FDIC-Receiver’s role in the sale of the equity stake?
As the Receiver of Signature Bridge Bank, N.A., the FDIC is responsible for managing the bank’s assets, including the sale of equity interests in ventures holding rent-stabilized and rent-controlled multifamily loans.
Who is Community Preservation Corporation (CPC)?
The Community Preservation Corporation (CPC) is a nonprofit multifamily finance company founded in 1974. Their mission is to provide financial resources to stabilize and revitalize underserved communities. CPC plays a crucial role in managing, servicing, and preserving the affordability of the assets acquired in this transaction.
How will the preservation of affordability be ensured?
CPC will be responsible for managing the assets of each venture in accordance with the terms of the transactions. They will work closely with the FDIC-Receiver to monitor and oversee the portfolios, ensuring the preservation of affordability in rent-stabilized and rent-controlled multifamily properties.
What is the significance of this sale for the preservation of affordable housing?
By partnering with CPC and retaining a significant equity interest in the ventures, the FDIC-Receiver ensures that the assets are managed by an organization with expertise in multifamily finance and a commitment to serving underserved communities. This collaboration aims to preserve the availability and affordability of residential real property for low- and moderate-income individuals.
For more information about the sale and the FDIC-Receiver’s asset dispositions, visit [VisBanking](https://visbanking.com/). To learn about pricing or request a demo of the services offered, visit [VisBanking’s pricing](https://visbanking.com/pricing/) and [demo request](https://visbanking.com/request-demo/) pages.
