Starwood Property Trust (NYSE: STWD) and private equity firm Starwood Capital Group will acquire LNR Property LLC for $1.05 billion.
Miami Beach, Fla.-based LNR is a diversified real estate investment, finance management and development company.
Starwood Property, headquartered in Greenwich, Conn., originates, invests in and manages commercial mortgage loans, as well as other real estate investments. The company also invests in residential mortgage-backed securities. Starwood Capital focuses on investing in real estate and has raised more than $16 billion in capital since its founding in 1991.
The Starwood entities will buy LNR’s U.S. special servicer, U.S. investment securities portfolio, Archetype Mortgage Capital, Archetype Financial Institution services, LNR Europe and part of Auction.com for $856 million.
The companies will pay $197 million for LNR’s commercial property group and the other part of LNR’s interest in Auction.com.
Starwood expects the deal to increase its revenue sources, add scale to its operating platform and expand its proprietary origination capabilities. The Starlight companies were started by real estate mogul Barry Sternlicht.
LNR is currently owned by affiliates of Aozora Bank Ltd., which is a subsidiary of funds managed by Cerberus Capital Management LP, iStar Financial, Oaktree Capital Management LP and Vornado Realty Trust.
Citigroup and Credit Suisse served as Starwood’s financial advisers. Sidley Austin LLP is acting as legal counsel. Lazard is financial advisers to the sellers.