Bloomberg News

Ranieri, WL Ross to Buy Deutsche Bank Multifamily Loan Unit

September 26, 2011

(Updates with comment from executives in fourth and sixth paragraphs.)

Sept. 26 (Bloomberg) -- Ranieri Real Estate Partners LP and private-equity funds affiliated with WL Ross & Co. agreed to buy Deutsche Bank Berkshire Mortgage, an originator of multifamily loans, from Deutsche Bank AG.

The firm services a $28 billion apartment portfolio, Ranieri Real Estate and WL Ross said in a statement today. It originates loans for Fannie Mae and Freddie Mac, the mortgage- finance companies in U.S. government conservatorship, as well as the Federal Housing Administration.

Demand for rental housing is rising as foreclosures force people out of their homes and property buyers find it harder to get mortgages. Apartment vacancies matched the lowest level since 2007 in the three months ended June 30, Reis Inc. said in a July report. Originations for multifamily loans more than doubled in the second quarter from a year earlier, according to an index compiled by the Mortgage Bankers Association.

“We expect the fundamentals of the multifamily market to continue to improve and the shifting preference toward renting over homeownership to fuel significant new demand, making DBBM a strong platform for future growth,” Jon Vacarro, co-founder and chief executive office of Ranieri Real Estate Partners, said in the statement.

Ranieri Real Estate is a unit of Ranieri Partners LLC, the investment company co-founded by mortgage-bond pioneer Lewis Ranieri. WL Ross, based in New York, is led by billionaire Wilbur Ross.

WL Ross has “long been interested” in the multifamily segment and sees it as a “fundamentally important and growing sector of the housing market,” James Lockhart, vice chairman of the firm and former director of the Federal Housing Finance Agency, said in the statement.

Deutsche Bank Berkshire Mortgage will be renamed following the completion of the deal, which is expected by the end of the year. Terms of the acquisition weren’t disclosed.

--Editors: Kara Wetzel, Daniel Taub

To contact the reporter on this story: Katie Spencer in New York at Katiespencer14@bloomberg.net

To contact the editor responsible for this story: Kara Wetzel at kwetzel@bloomberg.net


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