PacWest Bancorp has announced the sale of a portfolio of 74 real estate construction loans with an aggregate principal outstanding balance of around $2.6 billion to a unit of Kennedy-Wilson Holdings Inc. The Los Angeles-based lender had indicated in May it was in talks with potential partners and investors about strategic options.
The sale of the loans is expected to take pressure off the bank from the funding side, as they will no longer need to use extensive deposits or borrowings to fund that part of the portfolio. The transaction is expected to close in multiple tranches during the second quarter and early part of the third quarter of 2023.
Kennedy-Wilson is a global real estate investment firm that focuses on acquiring undervalued commercial and residential assets in select high-growth markets. The sale of the loans is seen as a positive move for PacWest, as it will help the bank to improve its liquidity and profitability.