STARWOOD TO PURCHASE $503 MILLION LOAN PORTFOLIO FROM TIAA-CREF

GREENWICH, CONN., AND CHARLOTTE, N.C. Ń Greenwich-based Starwood Property Trust has signed a definitive agreement to acquire a $503 million loan portfolio from Charlotte-based TIAA-CREF. Starwood will pay $510 million for the portfolio, plus accrued interest. The portfolio contains 20 performing commercial real estate loans comprising 18 senior first mortgage A-notes and two junior first mortgage B-notes. The portfolio's weighted averages include a 17.7 percent debt yield, a remaining term of 1.7 years, a coupon of 7.75 percent and a debt-service coverage ratio of 1.8x. In a statement, Starwood CEO Barry Sternlicht said, [T]his investment's high debt yield and relatively short duration should allow us to reinvest capital as the loans mature or provide a built-in pipeline of originations. Almost 20 percent of this portfolio will mature within 1 year, and, as such, these assets are an extremely attractive alternative for cash. They can also be modified, extended or rolled into new term debt and can be levered short term, if necessary. The properties secured by the loans include 4.5 million square feet of retail and office space in 10 states. The transaction is expected to close at the end of February. Ń Coleman Wood