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Atlantic Union Sells $2 Billion CRE Loan Portfolio

Atlantic Union Sells $2 Billion CRE Loan Portfolio

Atlantic Union Sells $2B CRE Loan Portfolio to Blackstone

June 26, 2025 | Richmond, VA & New York

Atlantic Union Bank (NYSE: AUB) has finalized the sale of approximately $2 billion in performing commercial real estate (CRE) loans to Blackstone Real Estate Debt Strategies (BREDS). These loans were originally acquired during Atlantic Union’s April 1, 2025 merger with Sandy Spring Bancorp, and the move highlights key trends in both banks’ balance sheets.

Why This Matters for Atlantic Union

  • CRE Exposure Management: The bank is reducing its risk concentration as regulators and markets critically assess CRE holdings.
  • Capital Reallocation: Proceeds will repay high-cost deposits and beef up its securities portfolio.
  • Post-Merger Execution: This is one of the first significant actions following its Sandy Spring integration, reinforcing Atlantic Union’s growth strategy.

Why This Matters for Blackstone

  • Debt Strategy Expansion: The deal boosts Blackstone’s $76 billion real estate debt platform and continues its strategy of acquiring CRE loans in the “low 90s” of par.
  • Yield Capture: With discounted assets, Blackstone is positioned to earn attractive returns in a market disrupted by higher rates.
  • Institutional Demand: The transaction channels investor capital into CRE debt amid traditional banks pulling back.

Why This Matters to the Real Estate Market

  • Lending Landscape Shift: Private capital providers like Blackstone are stepping in to fill the void left by retreating regional banks.
  • Asset Repricing & Liquidity: The sale reflects a broader CRE market reset—especially in office and transitional sectors—highlighting new pricing norms.
  • Credit Availability: As banks divest, access to capital for CRE borrowers is becoming more diversified across bank and non‑bank lenders.

Why This Matters to Investors & Industry Professionals

  • CRE Investors: This deal is a bellwether for evolving loan repricing and financing options.
  • Bankers & Lenders: It signals punitive regulatory and market pressure on banks to manage CRE concentration and explore alternative capital solutions.
  • Market Watchers: The transaction underscores Blackstone’s emerging role in reshaping CRE finance through scale and private capital investment.

Executive Insights

“After closing our acquisition of Sandy Spring, we have been focused on integration and execution,” said John Asbury, Atlantic Union’s CEO. “This transaction is another proof point of our ability to deliver on deals that create long‑term value.” costar.com+14blackstone.com+14investors.atlanticunionbank.com+14

Tim Johnson, Global Head of BREDS, stated: “With $76 billion in AUM, we are well‑positioned to pursue differentiated credit opportunities.” investors.atlanticunionbank.commarkets.ft.com+5blackstone.com+5rttnews.com+5

Deal Terms at a Glance

  • Portfolio Size: ~$2 billion in performing CRE loans
  • Sale Pricing: Low 90s % of par
  • Servicing: Retained by Atlantic Union
  • Use of Proceeds: High-cost deposit repayment & securities portfolio growth

Blackstone's Broader Strategy

BREDS has acquired over $20 billion in CRE loan portfolios in the past two years, including:

This is one in a series of purchases that demonstrate Blackstone’s systematic approach to commercial real estate lending.

Transaction Advisors

Atlantic Union:

  • Structuring Advisor: Morgan Stanley & Co. LLC
  • Legal Advisor: Hunton Andrews Kurth LLP

Blackstone:

  • Financial Advisors: Citigroup Global Markets Inc., CBRE National Loan & Portfolio Sale Advisors
  • Legal Advisors: Gibson, Dunn & Crutcher LLP; Ropes & Gray LLP; Benesch Friedlander Coplan & Aronoff LLP

Source

Atlantic Union and Blackstone Joint Press Release, Business Wire, June 26, 2025 investors.atlanticunionbank.com+14blackstone.com+14bankingdive.com+14

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