Breaking: Ranieri Acquires Deutsche Bank Berkshire Mortgage and its $28B Portfolio

Ranieri Real Estate Partners, in conjunction with private-equity funds affiliated with WL Ross & Co. L.L.C., has just announced its acquisition of Deutsche Bank Berkshire Mortgage, a subsidiary of Deutsche Bank.

September 26, 2011
By Nicholas Ziegler, News Editor

Deutsche Bank Berkshire Mortgage is changing owners, moving into the waiting arms of Ranieri Real Estate Partners L.P. and private equity funds affiliated with WL Ross & Co. L.L.C. for an undisclosed amout. DBBM, a major player in multi-family, is the second-largest originator of Fannie Mae loans and services, with more than $28 billion in its loan portfolio.

The transaction reflects the value of the multi-family sector, which has rebounded more strongly than areas of commercial real estate. A report by the National Association of Realtors predicts that vacancy rates for apartments nationwide will drop from 5.5 percent in the third quarter of 2011 to 4.6 percent in the third quarter of 2012, noting that anything less than 5 percent is considered a landlord’s market.

The expected uptick in values played a major role in the firm’s purchase, according to Ranieri.

“The DBBM team has built a top-tier company with a solid business model and proven track record of providing needed liquidity to the multi-family housing industry,” Jon Vaccaro, co-founder and CEO of Ranieri, said. “We expect the fundamentals of the multi-family market to continue to improve and the shifting preference toward renting over home ownership to fuel significant new demand, making DBBM a strong platform for future growth.”

The Berkshire unit, founded in 1988 and becoming a part of Deutsche Bank in 2004, will retain its current management.

The acquisition is expected to be completed by the end of the year, and the company will be renamed following the closing. Completion of the transaction is not contingent on financing but is subject to approval by Fannie Mae, Freddie Mac and the FHA as well as other customary closing conditions.