[Federal Register Volume 77, Number 99 (Tuesday, May 22, 2012)]
[Notices]
[Pages 30307-30308]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-12389]


-----------------------------------------------------------------------

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-5640-N-01]


Notice of HUD-Held Multifamily and Healthcare Loan Sale (MHLS 
2012-2)

AGENCY: Office of the Assistant Secretary for Housing--Federal Housing 
Commissioner, HUD.

ACTION: Notice of sale of mortgage loans.

-----------------------------------------------------------------------

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 2012-2). 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) was made available to 
qualified bidders on May 9, 2012. There will be two offerings in this 
sale, held on two separate dates. Bids for the loans must be submitted 
on the respective bid dates, which are currently scheduled for June 6, 
2012, and July 19, 2012. HUD anticipates that awards will be made on or 
before June 7, 2012, for the first bid date, and on or before July 20, 
2012, for the second bid date. Closings are expected to take place 
between June 18 and June 27, 2012, for the first bid date, and between 
July 30 and August 6, 2012, for the second bid date.

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 
www.hud.gov/fhaloansales. Please mail and fax executed documents to 
KEMA Advisors: KEMA Advisors, c/o The Debt Exchange, 133 Federal 
Street, 10th Floor, Boston, MA 02111, Attention: MLS 2012-2 Sale 
Coordinator, Fax: 1-978-967-8607.

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 its intention to sell in MHLS 
2012-2 certain unsubsidized mortgage loans (Mortgage Loans) secured by 
multifamily and healthcare properties located throughout the United 
States. The Mortgage Loans are comprised 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 may be stratified for bidding purposes into 
several mortgage loan pools. Each pool may 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 2012-2.
    There will be one Mortgage Loan Pool, Pool 202, consisting 
of a hospital note, for which bids may only be submitted by non-profit 
entities, Indian tribes, and Tribal organizations.

The Bidding Process

    The BIP will describe in detail the procedure for bidding in MHLS 
2012-2. The BIP will also include a standardized non-negotiable 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 that the 
bidder's aggregate bid is less than $100,000, 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 between June 18 and June 22, 2012, for 
the first bid date and between July 31 and August 6, 2012, for the 
second bid date.
    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 2012-2. 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.

[[Page 30308]]

Mortgage Loan Sale Policy

    HUD reserves the right to add Mortgage Loans to, or delete Mortgage 
Loans from, MHLS 2012-2 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 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 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 2012-2:
    (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, and Title 2 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 2012-2;
    (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 2012-2;
    (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 2012-2;
    (7) Any affiliate, principal or employee of any person or entity 
that, within the two-year period prior to June 1, 2012, serviced any of 
the Mortgage Loans or performed other services for or on behalf of HUD;
    (8) Any contractor or subcontractor to HUD that otherwise had 
access to information concerning the Mortgage Loans on behalf of HUD or 
provided services to any person or entity which, within the two-year 
period prior to June 1, 2012, had access to information with respect to 
the Mortgage Loans on behalf of HUD;
    (9) Any employee, officer, director or any other person that 
provides or will provide services to the potential bidder with respect 
to such Mortgage Loans during any warranty period established for the 
Loan Sale, that (a) serviced any of the Mortgage Loans or performed 
other services for or on behalf of HUD or (b) within the two-year 
period prior to June 1, 2012, provided services to any person or entity 
which serviced, performed services or otherwise had access to 
information with respect to the Mortgage Loans for or on behalf of HUD;
    (10) Any mortgagor or operator that failed to submit to HUD on or 
before May 30, 2012, audited financial statements for fiscal years 2008 
through 2011 (for such time as the project has been in operation or the 
prospective bidder served as operator, if less than three (3) years) 
for a project securing a Mortgage Loan;
    (11) 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 May 30, 2012;
    (12) Additionally, in MHLS 2012-2, only non-profit entities, Indian 
tribes, and Tribal organizations may qualify to bid on Pool  
202.
    Prospective bidders should carefully review the Qualification 
Statement to determine whether they are eligible to submit bids on the 
Mortgage Loans in MHLS 2012-2.

Freedom of Information Act Requests

    HUD reserves the right, in its sole and absolute discretion, to 
disclose information regarding MHLS 2012-2, 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 2012-2, 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 2012-2 and does not establish HUD's 
policy for the sale of other mortgage loans.

    Dated: May 16, 2012.
Carol J. Galante,
Acting Assistant Secretary for Housing--Federal Housing Commissioner.
[FR Doc. 2012-12389 Filed 5-21-12; 8:45 am]
BILLING CODE 4210-67-P