Distressed debt investors are looking into German property company IVG Immobilien as some lenders try to minimize potential heavy losses due to the property company's debt restructuring.

IVG has an outstanding debt  of almost 4 billion euro ($5.3 billion) composed mostly of bank loans, most of which are due to be refinanced by the end of 2014. The property company is about to breach the covenants on its debts.

Banks seeking to cut their losses have sold the loans to investors at distressed level, which is around mid-80 percent of face value. Between 400 million euros and 500 million in loans have been sold and more trades are expected, according to sources.

Based on Thomas Reuters LPC data, lenders to IVG include Commerzbank, BayernLB, DZ Bank, Deutsche Bank, Deutsche Postbank, HSH Nordbank, IKB Deutsche Industrie Bank, KfW IPEX-Bank, LBBW, NordLB and WGZ-Bank.

The company had earlier said it needed to restructure its debt  so it can have enough capital to refinance its loans.