KeyBank Real Estate Capital entered into an agreement with Bank of America N.A. to purchase certain commercial mortgage servicing rights that will substantially increase its commercial mortgage servicing business. KeyBank will purchase substantially all of the third party CMBS and special servicing rights from Bank of America’s global mortgages and securitized products business.
Simultaneously, KeyBank entered into a long-term sub-servicing agreement with Berkadia Commercial Mortgage LLC that will make Berkadia a sub-servicer for all primary CMBS servicing acquired from Bank of America. KeyBank has also agreed to acquire Berkadia’s CMBS special servicing business.
As of March 31, Bank of America had a total commercial mortgage servicing portfolio of approximately $110.5 billion and a CBMS special servicing portfolio totaling $14 billion. Upon completion of the transaction, KeyBank’s commercial mortgage servicing portfolio will total approximately $205 billion, placing it among the top three largest servicers of commercial/multifamily loans in the country. It will also become a special servicer for approximately $47 billion in CMBS loans on a pro-forma basis, making it the fifth largest CMBS special servicer in the United States.
“This acquisition helps to ensure that Key is well-positioned for growth and represents our willingness to invest in our corporate bank business,” said KeyBank Chairman and CEO Beth E. Mooney in a statement.
Bank of America’s third party CMBS portfolio includes servicing for a variety of private investors, making the acquisition subject to investor consent. KeyBank plans to close the transaction in the second quarter.