[Federal Register Volume 76, Number 40 (Tuesday, March 1, 2011)]
[Notices]
[Pages 11256-11257]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-4408]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-5503-N-01]
Notice of HUD-Held Healthcare Loan Sale (HCLS 2011-1)
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 sale of certain unsubsidized
healthcare mortgage loans, without Federal Housing Administration (FHA)
insurance, in a competitive, sealed bid sale (HCLS 2011-1). This notice
also describes generally the bidding process used for the sale and
certain persons who were ineligible to bid. The Bidder's Information
Package (BIP) was made available to qualified bidders late January.
Closings are expected to take place by March 10, 2011.
FOR FURTHER INFORMATION CONTACT: John Lucey, Deputy Director, Asset
Sales Office, Room 3136, U.S. Department of Housing and Urban
Development, 451 Seventh Street, SW., Washington, DC 20410-8000;
telephone 202-708-2625, extension 3927. Hearing- or speech-impaired
individuals may call 202-708-4594 (TTY). These are not toll-free
numbers.
SUPPLEMENTARY INFORMATION: HUD announces a sale in HCLS 2011-1 of
certain unsubsidized mortgage loans (Mortgage Loans) secured by
healthcare properties located throughout the United States. The
Mortgage Loans were comprised of non-performing mortgage loans. A final
listing of the Mortgage Loans was included in the BIP. The Mortgage
Loans were sold without FHA insurance and with servicing released. HUD
offered qualified bidders an opportunity to bid competitively on the
Mortgage Loans.
The Mortgage Loans may be stratified for bidding purposes into
several mortgage loan pools. Each pool contained Mortgage Loans that
generally had similar performance, property type, geographic location,
lien position and other characteristics. Qualified bidders
[[Page 11257]]
were able to submit bids on one or more pools of Mortgage Loans or bid
on individual loans. A mortgagor who was a qualified bidder was
permitted to submit an individual bid on its own Mortgage Loan.
The Bidding Process
The BIP described in detail the procedure for bidding in HCLS 2011-
1. The BIP also include a standardized non-negotiable loan sale
agreement (Loan Sale Agreement).
As part of its bid, each bidder was required to submit a deposit
equal to the greater of $100,000 or 10% of the bid price. In the event
the bidder's aggregate bid was less than $100,000.00, the minimum
deposit was not less than fifty percent (50%) of the bidder's aggregate
bid. HUD evaluated the bids submitted and determined the successful
bids in its sole and absolute discretion. If a bidder was successful,
the bidder's deposit was non-refundable and applied toward the purchase
price. Deposits were returned to unsuccessful bidders. Closings are
scheduled to occur by March 10, 2011.
These were the essential terms of sale. The Loan Sale Agreement,
which was included in the BIP, contained additional terms and details.
To ensure a competitive bidding process, the terms of the bidding
process and the Loan Sale Agreement were not subject to negotiation.
Due Diligence Review
The BIP described the due diligence process for reviewing loan
files in HCLS 2011-1. Qualified bidders were able to access loan
information remotely via a high-speed Internet connection.
Mortgage Loan Sale Policy
HUD reserved the right to add Mortgage Loans to or delete Mortgage
Loans from HCLS 2011-1 at any time prior to the Award Date. HUD also
reserved 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 was a sale of unsubsidized mortgage loans, pursuant to Section
204(a) of the Departments of Veterans Affairs and Housing and Urban
Development, and Independent Agencies Appropriations Act of 1997, 12
U.S.C. 1715z-11a(a).
Mortgage Loan Sale Procedure
HUD selected a competitive sale as the method to sell the Mortgage
Loans. 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 was required to
complete, execute and submit both a Confidentiality Agreement and a
Qualification Statement acceptable to HUD. The following individuals
and entities were ineligible to bid on any of the Mortgage Loans
included in HCLS 2011-1:
(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, and Title 2 of the Code of Federal
Regulations, Part 2424;
(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 HCLS 2011-1;
(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 HCLS 2011-1;
(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 HCLS 2011-1;
(7) Any mortgagor (or affiliate of a mortgagor) that failed to
submit to HUD on or before January 31, 2011, audited financial
statements for fiscal years 2005 through 2010 for a project securing a
Mortgage Loan;
(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 and or healthcare
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 January 31, 2011;
(9) Any entity or individual that serviced or held any Mortgage
Loan at any time during the 2-year period prior to February 1, 2011, 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 2-year
period prior to February 1, 2011; and
(10) Also ineligible to bid on any Mortgage Loan are: (a) Any
affiliate or principal of any entity or individual described in the
preceding sentence (subparagraph 9); (b) any employee or subcontractor
of such entity or individual during that 2-year period; or (c) any
entity or individual that employs or uses the services of any other
entity or individual described in this subparagraph 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 HCLS 2011-1.
Freedom of Information Act Requests
HUD reserves the right, in its sole and absolute discretion, to
disclose information regarding HCLS 2011-1, 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 HCLS 2011-1, 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 HCLS 2011-1 and does not establish HUD's
policy for the sale of other mortgage loans.
Dated: February 23, 2011.
David Stevens,
Assistant Secretary for Housing--Federal Housing Commissioner.
[FR Doc. 2011-4408 Filed 2-28-11; 8:45 am]
BILLING CODE 4210-67-P