Lone Star buys EUR 1b debt portfolio from the Bundesbank

An affiliate of Lone Star Real Estate Fund II has signed an agreement to acquire the A and B notes of CDO Excalibur Funding 1 from Deutsche Bundesbank. Excalibur contains a portfolio of loans secured on European real estate assets with a face value of EUR 960 mln.

The deal follows the completed acquisition of a single loan secured by various tranches of the Windermere XIV CMBS by another affiliate of Lone Star Real Estate Fund II from Excalibur in January 2012. The combined face value of both acquisitions amounts to EUR 1.4 bn.

This latest acquisition is expected to be completed by the end of April 2012.

Citigroup and Royal Bank of Canada are expected to provide senior debt financing to the affiliate of Lone Star Real Estate Fund II. Hudson Advisors’ affiliates will provide the loan servicing and asset management on behalf of Lone Star Real Estate Fund II.

Since 1995, private equity funds formed by the principals of Lone Star Real Estate Fund II have raised equity commitments of $33 bn.