WILL LEHMAN'S $40 BN PORTFOLIO FIND A BUYER?

Close on the heels of Merrill Lynch's July sale of $31billion in CDOs, Lehman Brothers has put a $40 billion real estateand mortgage portfolio on the market where, according to a majorityof this week's poll respondents, it can expect to remain for sometime. A huge majority of 68% were of the opinion that the portfoliowill languish on the market, while only 32% say it will quicklyfind a buyer. Dan Fasulo, managing director of Real CapitalAnalytics, thinks this deal could be attractive to certain buyers.Here are his thoughts:

"From the macro level, this is the type of deal that the largeequity funds love to sink their teeth into. The trick in this casewill be trying to figure out how to finance a deal this large inthis type of environment. But some of these equity funds, likeBlackstone and Carlyle, have raised tens of billions of dollars incapital, and they like to put that capital out all at once in justa few transactions as opposed to going deal by deal. It's moreefficient, because you spend the same amount of time analyzing alarge deal as you would a small deal. In this type of situation,where there's an element of distress, if this works out right,there's a chance to make a significant amount of money.