The Mortgage Loan and Real Estate Division of
a wholly owned subsidiary of
has been acquired by
Financial advisor to Swiss RE
KeyCorp acquisition expands Commercial Mortgage Finance capabilities
May 13, 2002 (Cleveland, OH) - KeyCorp (NYSE:KEY) today announced that it has entered into an agreement to acquire substantially all of the mortgage loan and real estate business of Hartford, Conn.-based Conning Asset Management. The deal expands the product set of Key Commercial Mortgage, the permanent lending unit of Key Commercial Real Estate, by providing it with the ability to originate and service loans on behalf of life insurance companies and pension fund clients.
The definitive purchase agreement was signed May 6, 2002. The transaction is expected to close within the next 60 days. The transaction was structured as an asset purchase. Terms of the deal, which is not subject to regulatory approval, were not disclosed.
Conning's mortgage loan and real estate business originates, services and securitizes multi-family, retail, industrial and office property mortgage loans on behalf of pension fund and life insurance company investors. The business currently services approximately $4 billion in commercial mortgage loans through its St. Louis office, and originates loans through offices in Atlanta, Chicago, Dallas, Denver, Los Angeles, San Francisco and Washington, D.C. The deal not only broadens Key Commercial Mortgage's scope of products and services, it offers additional opportunities for Key to convert construction and interim balance sheet loans into off-balance sheet permanent loans.
This is the third commercial real estate acquisition Key has made over the past two years as part of its overall strategy to create a national, commercial mortgage finance and servicing company. In 2000, Key acquired both National Realty Funding and Newport Mortgage to broaden its permanent product and servicing capabilities in the areas of CMBS, Fannie Mae, Freddie Mac and FHA lending.
"Conning's life company and pension fund expertise is an excellent fit with Key Commercial Mortgage, and we are excited to welcome these talented employees to our organization," said John E. Case, president of Key Commercial Mortgage. "We now have one of the most comprehensive commercial mortgage product offerings in the industry, which should allow us to meet virtually any commercial real estate financing need our clients might have."
"Key Commercial Mortgage is an outstanding fit with our existing business model," according to Michael McLellan, executive vice president of Conning's Mortgage Loans and Real Estate division. "We look forward to being part of the Key platform and one of the leading commercial mortgage finance companies in the nation."
Key Commercial Mortgage is the permanent lending division of Key Commercial Real Estate (KeyCRE), the nation's fifth-largest commercial real estate lender with approximately $8.5 billion in annual financing. KeyCRE provides construction and interim loans, equity and permanent commercial mortgages nationwide for virtually all property types. Its 563 financing professionals serve a national client base through 27 offices in major U.S. markets. KeyCRE is a business unit of KeyBank National Association, a subsidiary of Cleveland-based KeyCorp, one of the nation's largest bank-based financial services companies, with assets of approximately $81 billion.