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A Work in Progress

This past October, Distressed Assets Investor charted the evolution of the FDIC's structured sales program, in which the agency partners with one or…

By Paul Bubny - Northeast Region Editor for GlobeSt.com and Real Estate Forum. | Updated on December 09, 2011

This past October, Distressed Assets Investor charted the evolution of the FDIC’s structured sales program, in which the agency partners with one or more private institutions to take an equity stake in portfolios of commercial real estate loans from failed banks. Tom Galli, a Washington, DC-based shareholder in the real estate practice at law firm Greenberg Traurig, told DAI that the private sector would soon conduct transactions based on the FDIC model, which was very much a work in progress.

Today, that progress continues. Galli says the FDIC hasn’t hit upon a single formula for conducting these sales, but “the evolution continues” in the relative terms of structured transactions. Based on the input it receives from stakeholders, “the FDIC is doing a better job of refining its distinctions and limitations” on structured sales, thus helping private investors enhance the value of loans in structured transaction portfolios and avoid additional costs that broader restrictions would entail, he says.

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