Almost two weeks after taking over failed Chicago-based lender Corus, the Federal Deposit Insurance Corporation (FDIC) is quietly going through the process of selling an equity stake in an LLC, which contains the $5 billion in failed Corus loans.

In an earlier press release, the FDIC said it expects the sale to close within 30 days. But that’s about all of the information coming out. “We are in the process of selling those and cannot discuss the details as it is considered a private placement,” says Dave Barr, a spokesman for the FDIC. “Technically, we are not selling the loan portfolio. It is for specialized investors and is considered similar to a private stock sale, which is why what we can say is very limited.”

While The Wall Street Journal reported that bids are due for the portfolio this Friday, Barr says the process may not necessarily end with that deadline (which he wouldn’t confirm). “Even if bids are due that day, there could be a second round for best and final,” he says. “That decision isn’t made until after bids are analyzed and we [determine if] a second round is necessary.”

The Journal also reported that some well-heeled private investors, such as Related Cos. and Lubert-Adler Partners LP; Crescent Heights, a Miami developer, and Dallas private-equity firm Lone Star Funds; Starwood Capital Group; and Colony Capital LLC and iStar Financial Inc., will vie for those assets.

“Some of the top candidates are struggling with their own portfolios right now,” says Jack McCabe, president of Deerfield Beach, Fla.,-based McCabe Research & Consulting. Still, there is speculation that the Corus sale will help set a floor for distressed asset prices. McCabe estimates non-performing loans will go for 15 to 25 cents on the dollar, while performing for 60 to 80 cents on the dollar.

In particular, McCabe thinks the sale will have a big impact in markets like Las Vegas, Atlanta, and Chicago, which don’t have as many condo issues as South Florida, where Corus supposedly has 14 assets. “I wouldn’t say it will be crucial for setting a baseline,” McCabe says. “It will be one factor in setting the bottom in South Florida. In other markets, it will be the barometer or standard setter.”

Adam Cappel, president of, a Miami research firm, has questions about what the ultimate bidder will do. “Are they going to subdivide it and parse it off or is one group going to take the whole thing?,” he asks. “Will they blow out the inventory as quickly as possible because they’re getting it as a discount or will they work through the stuff more slowly?”