MORRISTOWN, N.J. AND NEW YORK CITY — Valley National Bancorp (NASDAQ: VLY), the holding company for Valley National Bank, has sold $925 million worth of commercial real estate mortgage loans to Brookfield Asset Management (NYSE: BAM).
Of the $925 million loan pool, $823 million had been previously identified and transferred to held for sale as of Sept. 30, 2024, as the firm sought to reduce its exposure to the commercial real estate sector.
The loans were sold at a discount of 1 percent to value, which the bank expects will result in an immaterial net loss during the fourth quarter. Valley will retain customer-facing servicing responsibilities for the financings following the transaction.
“The sale of this performing commercial real estate loan pool has helped to accelerate progress toward our strategic balance sheet goals,” says Ira Robbins, chairman and CEO of Valley.
Valley is a regional bank with over $62 billion in assets under management. The company operates retail branch locations and commercial banking offices across New Jersey, New York, Florida, Alabama, California and Illinois.
The Morristown, N.J.-based bank’s stock price closed on Wednesday, Dec. 4 at $10.48 per share, up slightly from $9.29 a year ago. Morgan Stanley & Co. LLC served as the sole advisor to the bank on the transaction.
New York City-based Brookfield is a leading global alternative asset manager with approximately $1 trillion of assets under management across renewable power and transition, infrastructure, private equity, real estate and credit sectors. The firm recently moved its corporate headquarters to New York from Toronto.
“Brookfield’s acquisition of Valley’s portfolio of high-quality, performing loans is strategic for both parties and demonstrates our ability to step in as an alternative lender to provide creative, flexible capital solutions,” says Bill Powell, managing partner of Brookfield.
Brookfield’s stock price closed on Wednesday at $57.49 per share, up from $34.24 a year ago, a nearly 68 percent increase.
— Katie Sloan