[Federal Register Volume 70, Number 238 (Tuesday, December 13, 2005)]
[Notices]
[Pages 73787-73788]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E5-7269]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-4639-N-09]
Notice of HUD-Held Multifamily and Healthcare Loan Sale (MHLS
2005-3)
AGENCY: Office of the Assistant Secretary for Housing--Federal Housing
Commissioner, HUD.
ACTION: Notice of sale of mortgage loans.
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SUMMARY: This notice announces HUD's intention to sell certain
unsubsidized multifamily and healthcare mortgage loans, without Federal
Housing Administration (FHA) insurance, in a competitive, sealed bid
sale (MHLS 2005-3). This notice also describes generally the bidding
process for the sale and certain persons who are ineligible to bid.
DATES: The Bidder's Information Package (BIP) was made available to
qualified bidders on November 10, 2005. Bids for the loans must be
submitted on the bid date, which is currently scheduled for December
14, 2005. HUD anticipates that awards will be made on or before
December 16, 2005. Closings are expected to take place on December 21,
2005.
ADDRESSES: To become a qualified bidder and receive the BIP,
prospective bidders must complete, execute, and submit a
Confidentiality Agreement and a Qualification Statement acceptable to
HUD. Both documents will be available on the HUD Web site at http://www.hud.gov/offices/hsg/comp/asset/mfam/mhls.cfm. The executed
documents must be mailed and faxed to S.S.D., Inc., HUD's Transaction
Specialist for the sale, at 1400 K Street, NW., Suite 950, Attention:
MHLS 2005-3 Sale Coordinator, Fax: (202) 464-3047.
FOR FURTHER INFORMATION CONTACT: Myrna Gordon, Deputy Director, Asset
Sales Office, Department of Housing and Urban Development, 451 Seventh
Street, SW., Room 3136, Washington, DC 20410-8000; telephone (202) 708-
2625, extension 3369 or Gregory Bolton, Senior Attorney, Office of
Insured Housing, Multifamily Division, Room 9230; telephone (202) 708-
0614, extension 5245. Hearing- or speech-impaired individuals may call
(202) 708-4594 (TTY). These are not toll-free numbers.
SUPPLEMENTARY INFORMATION: HUD announces its intention to sell in MHLS
2005-3 certain unsubsidized mortgage loans (Mortgage Loans) secured by
multifamily and healthcare properties located throughout the United
States. The Mortgage Loans are comprised primarily of non-performing
mortgage loans. A final listing of the Mortgage Loans will be included
in the BIP. The Mortgage Loans will be sold without FHA insurance and
with servicing released. HUD will offer qualified bidders an
opportunity to bid competitively on the Mortgage Loans.
The Mortgage Loans will be stratified for bidding purposes into
several mortgage loan pools. Each pool will contain Mortgage Loans that
generally have similar performance, property type, geographic location,
lien position and other characteristics. Qualified bidders may submit
bids on one or more pools of Mortgage Loans or may bid on individual
loans. A mortgagor who is a qualified bidder may submit an individual
bid on its own Mortgage Loan. Interested Mortgagors should review the
Qualification Statement to determine whether they may also be eligible
to qualify to submit bids on one or more pools of Mortgage Loans or on
individual loans in MHLS 2005-3.
The Bidding Process
The BIP will describe in detail the procedure for bidding in MHLS
2005-3. The BIP will also include a standardized nonnegotiable loan
sale agreement (Loan Sale Agreement) and a loan information CD that
contains a spreadsheet with selected attributes for each Mortgage Loan.
As part of its bid, each bidder must submit a deposit equal to the
greater of $100,000 or 10% of the bid price. HUD will evaluate the bids
submitted and determine the successful bids in its sole and absolute
discretion. If a bidder is successful, the bidder's deposit will be
non-refundable and will be applied toward the purchase price. Deposits
will be returned to unsuccessful bidders.
[[Page 73788]]
Closings are scheduled to occur on December 21, 2005.
These are the essential terms of sale. The Loan Sale Agreement,
which will be included in the BIP, will contain additional terms and
details. To ensure a competitive bidding process, the terms of the
bidding process and the Loan Sale Agreement are not subject to
negotiation.
Due Diligence Review
The BIP will describe the due diligence process for reviewing loan
files in MHLS 2005-3. Qualified bidders will be able to access loan
information remotely via a high-speed Internet connection. Further
information on performing due diligence review of the Mortgage Loans
will be provided in the BIP.
Mortgage Loan Sale Policy
HUD reserves the right to add Mortgage Loans to or delete Mortgage
Loans from MHLS 2005-3 at any time prior to the Award Date. HUD also
reserves the right to reject any and all bids, in whole or in part,
without prejudice to HUD's right to include any Mortgage Loans in a
later sale. Mortgage Loans will not be withdrawn after the Award Date
except as is specifically provided in the Loan Sale Agreement.
This is a sale of unsubsidized mortgage loans. Pursuant to the
Multifamily Mortgage Sale Regulations, 24 CFR 290.30 et seq., the
Mortgage Loans will be sold without FHA insurance. Consistent with
HUD's policy as set forth in 24 CFR 290.35, HUD is unaware of any
Mortgage Loan that is delinquent and secures a project (1) for which
foreclosure appears unavoidable, and (2) in which very-low income
tenants reside who are not receiving housing assistance and who would
be likely to pay rent in excess of 30 percent of their adjusted monthly
income if HUD sold the Mortgage Loan. If HUD determines that any
Mortgage Loans meet these criteria, they will be removed from the sale.
Mortgage Loan Sale Procedure
HUD selected a competitive sale as the method to sell the Mortgage
Loans primarily to satisfy the Mortgage Sale Regulations. This method
of sale optimizes HUD's return on the sale of these Mortgage Loans,
affords the greatest opportunity for all qualified bidders to bid on
the Mortgage Loans, and provides the quickest and most efficient
vehicle for HUD to dispose of the Mortgage Loans.
Bidder Eligibility
In order to bid in the sale, a prospective bidder must complete,
execute and submit both a Confidentiality Agreement and a Qualification
Statement acceptable to HUD. The following individuals and entities are
ineligible to bid on any of the Mortgage Loans included in MHLS 2005-3:
(1) Any employee of HUD, a member of such employee's household, or
an entity owned or controlled by any such employee or member of such an
employee's household;
(2) any individual or entity that is debarred, suspended, or
excluded from doing business with HUD pursuant to Title 24 of the Code
of Federal Regulations, Part 24;
(3) any contractor, subcontractor and/or consultant or advisor
(including any agent, employee, partner, director, principal or
affiliate of any of the foregoing) who performed services for or on
behalf of HUD in connection with MHLS 2005-3;
(4) any individual who was a principal, partner, director, agent or
employee of any entity or individual described in subparagraph 3 above,
at any time during which the entity or individual performed services
for or on behalf of HUD in connection with MHLS 2005-3;
(5) any individual or entity that uses the services, directly or
indirectly, of any person or entity ineligible under subparagraphs 1
through 4 above to assist in preparing any of its bids on the Mortgage
Loans;
(6) any individual or entity which employs or uses the services of
an employee of HUD (other than in such employee's official capacity)
who is involved in MHLS 2005-3;
(7) any mortgagor (or affiliate of a mortgagor) that failed to
submit to HUD on or before November 30, 2005, audited financial
statements for 1998 through 2004 for a project securing a Mortgage
Loan; and
(8) any individual or entity and any Related Party (as such term is
defined in the Qualification Statement) of such individual or entity
that is a mortgagor in any of HUD's multifamily housing programs and
that is in default under such mortgage loan or is in violation of any
regulatory or business agreements with HUD, unless such default or
violation is cured on or before November 30, 2005.
In addition, any entity or individual that serviced or held any
Mortgage Loan at any time during the two-year period prior to November
30, 2005, is ineligible to bid on such Mortgage Loan or on the pool
containing such Mortgage Loan, but may bid on loan pools that do not
contain Mortgage Loans that they have serviced or held at any time
during the two-year period prior to November 30, 2005. Also ineligible
to bid on any Mortgage Loan are: (a) Any affiliate or principal of any
entity or individual described in the preceding sentence; (b) any
employee or subcontractor of such entity or individual during that two-
year period; or (c) any entity or individual that employs or uses the
services of any other entity or individual described in this paragraph
in preparing its bid on such Mortgage Loan.
Prospective bidders should carefully review the Qualification
Statement to determine whether they are eligible to submit bids on the
Mortgage Loans in MHLS 2005-3.
Freedom of Information Act Requests
HUD reserves the right, in its sole and absolute discretion, to
disclose information regarding MHLS 2005-3, including, but not limited
to, the identity of any successful bidder and its bid price or bid
percentage for any pool of loans or individual loan, upon the closing
of the sale of all the Mortgage Loans. Even if HUD elects not to
publicly disclose any information relating to MHLS 2005-3, HUD will
have the right to disclose any information that HUD is obligated to
disclose pursuant to the Freedom of Information Act and all regulations
promulgated thereunder.
Scope of Notice
This notice applies to MHLS 2005-3 and does not establish HUD's
policy for the sale of other mortgage loans.
Dated: December 4, 2005.
Brian D. Montgomery,
Assistant Secretary for Housing--Federal Housing Commissioner.
[FR Doc. E5-7269 Filed 12-12-05; 8:45 am]
BILLING CODE 4210-27-P