Marblegate Asset Management, known for buying up distressed assets, now holds the largest lot of New York’s taxi-medallion loans, according to published reports Wednesday (Feb. 19).
The National Credit Union Administration said Wednesday that it had sold most of its medallion loan portfolio to Marblegate. Neither Marblegate nor the federal regulator gave details on the exact size of the sale. The NCUA said Marblegate had provided the best bid for the agency and also medallion owners.
The regulator, in a statement, said that private entities such as Marblegate have specialized skills and better resources, which can be an asset in dealing with borrowers in the ways the NCUA wasn’t able to.
A Marblegate spokesperson said he believes the entire industry needs to be focused on taxi drivers and modified so that it becomes stable enough for people to rely on as a business.
The Wall Street Journal reported earlier on Wednesday that Marblegate was looking at a deal to purchase a near-4,500 medallion loan portfolio for $350 million, said people familiar with the issue.
Inside the portfolio are more than 3,000 New York City taxi medallions, around 900 Chicago medallions and 100 or so medallions from other cities.
Marblegate already owns around 300 medallions, and roughly 1,000 medallion loans, mostly purchased from Capital One Financial Corp.
New York City as a whole has about 13,500 medallions, which give the owners the right to pick up a street hail in Manhattan. In 2013, each medallion traded for around $1 million. But the advent of the gig economy and ride-share companies like Uber have depreciated their value. Now, they go for only around $200,000 each.
The NCUA acquired many medallion loans after the collapse of numerous credit unions.
Members of Congress, as well as advocates for medallion owners, urged the NCUA to delay the sale to Marblegate, hoping New York City would set up a bailout fund and handle the issue that way. The NCUA said Wednesday’s deal didn’t preclude a later public-private partnership.