Bank of America Said to Sell Securities Backed by Lone Star DebtAlastair Marsh
Bank of America Corp. sold bonds backed by part of its 935 million-euro ($1.24 billion) loan to Lone Star Funds, according to a person with knowledge of the matter.
The U.S. lender sold 410 million euros of commercial mortgage-backed securities that are secured by debt used to finance Lone Star’s purchase of the Coeur Defense development in Paris, the city’s most expensive office complex, said the person who asked not to be named because the matter is private.
The transaction is the first CMBS backed by French real estate since 2007, the year Lehman Brothers Holdings Inc. sold bonds to finance its record 2.11 billion-euro acquisition of the same building. The Lehman notes soured after the bank’s collapse in 2008 and investors in the most junior portions of the debt suffered losses.
Saima Farooqi, a spokeswoman for Bank of America in London, declined to comment on the transaction.
Bank of America, based in Charlotte, North Carolina, will hold 75 million euros of the rest of the loan, while 320 million euros was syndicated to Axa SA’s property unit, according to the person. The remaining 130 million euros of mezzanine, junior-ranking debt, was sold to investors earlier this year, the person said.
Coeur Defense, which was designed by Jean-Paul Viguier and completed in 2001, has 175,367 square meters of letable space.