DebtX Puts $380M Loan Pool on Block

BOSTON-For some, the current credit crunch is a crisis, but others see increasing opportunities, as underscored by yesterday’s announcement from DebtX that it is bringing a $380-million pool of commercial real estate loans to the market. The locally based firm plans to peddle the notes in a four-pronged campaign conducted through its on-line exchange, beginning with a $70-million package that begins accepting bids on April 15.

The uncertain climate is stirring more lenders to harvest their notes in the expanding secondary market, according to DebtX CEO J. Kingsley Greenland II. Founded in 2000, DebtX is seeing “significantly more” activity than normal, he tells GlobeSt.com. “There’s more downside that upside right now,” he relays, explaining such turmoil often leads lenders to forgo “asset gathering” and focus on stabilizing a portfolio. Concentrated on the southeastern US, the loans assembled by DebtX run the gamut in quality, from non-performing and sub-performing to those that are up to date. The remaining three sales will each be around $100 million, says Greenland, with bidding for later traunches overlapping the completion of earlier rounds. Bidders will be allowed to pursue both individual and pools of loans.

The initiative involves more than 200 lending relationships, and the loans are secured by land as well as commercial and residential properties. There is not, however, an over-concentration of multifamily in the portfolio, says Greenland, despite that market’s continued difficulties in Florida and Texas and the anticipated availability of debt deals from that area. Loans in the DebtX stack are backed by assets in Atlanta, Orlando and south Florida, and range in size up to $20 million.