Blackstone Said to Buy $858 Million of Spain Property Loans

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Run by billionaire Stephen Schwarzman, Blackstone has become the largest private equity real estate investor, more than tripling its money in Hilton Worldwide Holdings Inc.

Run by billionaire Stephen Schwarzman, Blackstone has become the largest private equity real estate investor, more than tripling its money in Hilton Worldwide Holdings Inc.

Photographer: Michael Nagle/Bloomberg

Blackstone Group LP is buying a portfolio of bad loans with a nominal value of 790 million euros ($858 million) from Spanish lender CaixaBank SA, according to two people with knowledge of the matter.

The debt is linked to newly completed residential units as well as land and homes under development, according to the people, who asked not to be identified because the deal is not yet complete. The sale of the portfolio, known as Tourmalet, is expected to close at the end of the week, the people said.

Spanish banks are seeking to sell off bad real estate debt that has weighed on their balance sheets since the financial crisis sparked a property crash. Lenders foreclosed on more than 70,000 homes in 2014 with Andalusia, Catalonia and Valencia hit the hardest, according to data from the National Statistics Institute.

The assets backing the CaixaBank debt comprise 88 percent residential property, 9 percent of land and 3 percent commercial property, according to a sales document obtained by Bloomberg News. The assets are mainly based in Andalusia, Madrid, Castille La Mancha and Catalonia, according to the document.

Spokesmen for Blackstone and CaixaBank declined to comment on the deal.

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