[Federal Register: November 22, 2006 (Volume 71, Number 225)]
[Notices]
[Page 67625-67626]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr22no06-88]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-5113-N-01]
Notice of HUD-Held Multifamily and Healthcare Loan Sale (MHLS
2006-2)
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 2006-2). 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) will be made available to
qualified bidders on or about October 31, 2006. Bids for the loans must
be submitted on the bid date, which is currently scheduled for December
6, 2006. HUD anticipates that awards will be made on or before December
7, 2006. Closings are expected to take place on December 13, 2006.
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 The Debt Exchange, HUD's
Transaction Specialist for the sale, at 133 Federal Street, 10th Floor,
Boston, Massachusetts 02110, Attention: MHLS 2006-2 Sale Coordinator,
Fax: (617) 531-3499.
FOR FURTHER INFORMATION CONTACT: John Lucey, Acting 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 3927 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
2006-2 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 2006-2.
The Bidding Process
The BIP will describe in detail the procedure for bidding in MHLS
2006-2. The BIP will also include a standardized nonnegotiable loan
sale agreement (Loan Sale Agreement).
As part of its bid, each bidder must submit a deposit equal to the
greater of $100,000 or 10% of the bid price. In the event the bidder's
aggregate bid is less than $100,000.00, the minimum deposit shall be
not less than fifty percent (50%) of the bidder's aggregate bid. 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.
Closings are scheduled to occur on December 13, 2006.
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
[[Page 67626]]
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 2006-2. 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 2006-2 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 2006-2:
(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 2006-2;
(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 2006-2;
(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 2006-2;
(7) any mortgagor (or affiliate of a mortgagor) that failed to submit
to HUD on or before November 29, 2006, audited financial statements for
1999 through 2005 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 29, 2006.
In addition, any entity or individual that serviced or held any
Mortgage Loan at any time during the 2-year period prior to October 31,
2006, 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 October 31, 2006. 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 2-
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 2006-2.
Freedom of Information Act Requests
HUD reserves the right, in its sole and absolute discretion, to
disclose information regarding MHLS 2006-2, 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 2006-2, 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 2006-2 and does not establish HUD's
policy for the sale of other mortgage loans.
Dated: November 15, 2006.
Brian D. Montgomery,
Assistant Secretary for Housing--Federal Housing Commissioner.
[FR Doc. E6-19691 Filed 11-21-06; 8:45 am]
BILLING CODE 4210-67-P