Buyout firms Apollo Global Management LP and Centerbridge Capital Partners LLC have made competing bids for CW Financial Services, parent of the second-largest manager of delinquent U.S. commercial real estate loans, said two people with knowledge of the offers.
Berkadia Commercial Mortgage LLC, a partnership between Warren Buffett's Berkshire Hathaway Inc. and Leucadia National Corp., also was weighing a bid for CW Financial, said a third person familiar with the matter.
CWCapital Asset Management, a unit of CW Financial, is the special servicer of $143 billion of securitized real estate loans, including more than $18 billion that are delinquent. It has access to valuable pricing and payment information, said Ben Thypin, an analyst at Real Capital Analytics Inc. in New York. The new owner would be "in the driver's seat on a lot of troubled loans," he said.
CW Financial may fetch more than $200 million in the auction, which is being run by Beekman Advisors, said one of the people.
It is majority-owned by a unit of Caisse de Depot et Placement du Quebec, Canada's largest pension fund manager.
"The sale is in process, and we have no announcement at this time," said Francois Gaboury, a spokesman for the Caisse's Otera Capital subsidiary.
CWCapital would be the third special servicer to change hands since December. Berkadia bought Capmark Financial Group Inc.'s loan-servicing and mortgage-lending business for $468 million in December. Island Capital Group LLC, run by real estate investor Andrew Farkas, agreed in March to buy the special-servicing and debt-fund unit of Centerline Holding Co. for about $50 million in cash and $60 million in assumed debt.
CWCapital's largest troubled loan is $3 billion of debt on Stuyvesant Town-Peter Cooper Village, Manhattan's biggest apartment complex. The 80-acre property is facing foreclosure.
"CW may be the last major, independent special servicer to go on the market," said Mohsin Meghji, a principal at the restructuring firm Loughlin Meghji & Co. and chief restructuring officer at Capmark. "There's a short-term opportunity in servicing fees, and gaining a window into so many commercial real estate restructurings has a lot of long-term value."
