Bloomberg News

UBS, Citigroup Said to Team Up on Commercial Mortgage Bond Deal

November 09, 2011

Nov. 9 (Bloomberg) -- UBS AG, Citigroup Inc. and Natixis SA are planning a $750 million offering tied to commercial mortgages as soon as December, according to people familiar with the transaction.

Lenders including Deutsche Bank AG had been in talks with the banks to pool as much as $1.5 billion of property loans they’ve amassed this year after a slowdown left some banks unable to stockpile enough mortgages to sell as securities, said the people, who declined to be identified because the discussions aren’t public.

Europe’s fiscal crisis has roiled credit markets since July, causing gyrations in the value of securities tied to shopping malls, skyscrapers and hotels and causing a pullback in originations. One of the largest potential loans in the pooled deal would be $176 million in debt on the Poughkeepsie Galleria, a 1.2 million square-foot shopping center in New York, made by UBS last month.

Torie Von Alt, a spokeswoman for UBS, and Scott Helfman of Citigroup in New York, declined to comment. Mitch Karig, a Natixis spokesman, didn’t return a call for comment.

--Editors: Pierre Paulden, John Parry

To contact the reporter on this story: Sarah Mulholland in New York at smulholland3@bloomberg.net

To contact the editor responsible for this story: Alan Goldstein at agoldstein5@bloomberg.net


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