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December 3, 2023
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Kennedy Wilson Acquires Initial Tranche of Loans Valued at $3.25 Bil in Total Commitments


Kennedy Wilson has acquired an initial tranche of loans as part of a $5.7 bil loan portfolio purchase from Pacific Western Bank. This first tranche of loans acquired by Kennedy Wilson and certain controlled affiliates of Fairfax Financial Holdings Limited totaled $3.25 bil in total commitments and $1.8 bil in current principal balance.

The first tranche of loans was acquired for $1.6 bil. An additional 12 loans totaling $800 mil in commitments are expected to close on a rolling basis by no later than the end of July.

The loan portfolio is comprised of floating-rate construction loans that carry a weighted-average interest rate of approximately 8.6%, with approximately 80% of the portfolio secured by high-quality multifamily and student housing properties and the remainder including mainly industrial, hotel, and life science assets. The loan portfolio consists of loans located in Kennedy Wilsonís key western U.S. markets and expands the companyís footprint into new regions across the southern and eastern United States.

In its role as asset manager, Kennedy Wilson will earn customary fees and will have an ownership of 5% in the loan portfolio. The company is also finalizing arrangements with Pacific Western Bank for certain employees that originated and currently manage the loan portfolio to join the Kennedy Wilson team.

The $5.7 bil in loans arranged by Kennedy Wilson includes the $4.1 bil loan portfolio, $1.2 bil of loan commitments to be purchased by a third party ($970 mil of which have already been acquired), and $400 mil of loans subject to further due diligence.

The loan portfolio acquisition contributes to the rapid expansion of Kennedy Wilsonís global debt platform, which launched in 2020 and today totals $7 bil in total gross commitments, including future fundings and deals under contract, with significant capacity for growth.

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