Ranieri, WL Ross Team To Buy Deutsche Bank Berkshire Mortgage

Ranieri Real Estate Partners LP (RREP) and private equity funds affiliated with WL Ross & Co. LLC have agreed to acquire Deutsche Bank Berkshire Mortgage (DBBM), a Deutsche Bank subsidiary that originates federally backed multifamily loans. Terms of the deal were not disclosed.

DBBM is the second largest originator of Fannie Mae multifamily loans and services a $28 billion portfolio. The company, which was founded in 1988 and became a unit of Deutsche Bank in 2004, also originates loans for Freddie Mac and the Federal Housing Administration (FHA). The transaction is subject to approval by the government-sponsored enterprises and the FHA, as well as other customary closing conditions.

Jeff Day will remain as CEO, and the current management team and staff are expected to remain with the company, RREP and WL Ross say.

DBBM's 160 employees operate out of three primary offices in Bethesda, Md.; Boston; and Irvine, Calif. Additional offices are located in Dallas, Los Angeles, Nashville and Seattle.

Top brass at RREP and WL Ross are predicting a rebound in the multifamily market.

"We expect the fundamentals of the multifamily market to continue to improve and the shifting preference toward renting over homeownership to fuel significant new demand, making DBBM a strong platform for future growth," says Jon Vaccaro, co-founder and CEO of RREP.

James B. Lockhart III, vice chairman of WL Ross and former director of the Federal Housing Finance Agency, similarly sees multifamily as a growing sector of the housing market.

"We have long been interested in this sector, and we are confident that we have identified the right vehicle and point in the real estate cycle to pursue an investment," Lockhart says.

DBBM will be renamed following the closing of the acquisition, which the companies expect to occur by the end of the year.


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