Morgan Stanley picked as preferred bidder for Santander assets

Morgan Stanley Real Estate has emerged ahead of rival Goldman Sachs and private equity firm Cerberus to buy a EUR 3 bn real estate portfolio being sold by Spanish bank Santander.

According to Spanish press reports and sources who spoke to PropertyEU, the US investor has been chosen as preferred bidder for the assets, which involve thousands of residential units as well as a number of development sites. The company has mounted a EUR 1.2 bn bid for the company, representing a 60% discount to the market value of the assets.

A consortium of Cerberus and Goldman Sachs had offered less than EUR 1 bn for the portfolio, or a discount of some 70% to market value.

It is unclear how advanced negotiations between the two parties are.

Morgan Stanley was not available to comment.

Santander has become one of the country's largest property owners since the onset of the credit crisis in 2008. It has taken control of over EUR 8 bn of real estate in the past three years, including EUR 826 mln of assets in the first half of 2011. The Spanish financial giant first met investors in London at end-September to present the assets in the portfolio.