China Investment (CIC) and Blackstone paid 35 cents on the dollar for the portfolio, which had a face value of $1.1bn, reported Financial Times.
The portfolio includes both current and non-performing loans.
It was between 2005 and 2007, when the Japanese market appeared to be slowly recovering, that when Morgan Stanley made most of the loans.
Morgan Stanley had plans to slice the loans into securities and sell them in the commercial mortgage-backed securities market but was due the global financial crisis the plan derailed.
At the end of 2007, CIC bought 9.9% of Morgan Stanley for $5.6bn, and has also invested in Msref VII Global, Morgan Stanley’s latest property investment fund.
