Blackstone poaches RE execs from TPG – Exclusive

The New York-based private equity real estate giant has recruited two executives from TPG’s real estate debt platform for its own BREDS business.

Blackstone has tapped two new executives from TPG’s real estate debt origination business to join its real estate debt platform, Blackstone Real Estate Debt Strategies (BREDS).

The new hires are understood to be TPG Real Estate Finance Trust managing director and head of origination James Yung, who was hired in the last few weeks, and director Michael Nagelberg, who was hired in the last few months. Yung, who will be based in Los Angeles, and Nagelberg, who will be based in New York, are expected to start at Blackstone early next year after a garden leave period, according to two people familiar with the matter.

Both Blackstone and TPG declined to comment.

In January 2015, the Fort Worth, Texas-based investment firm purchased a 75 percent stake in a $2.5 billion portfolio of high-yield real estate loans from Deutsche Bank’s special situations group, launching TPG’s foray into real estate debt.

As part of the transaction, TPG also picked up a team of 11 origination and risk management professionals – which included both Yung and Nagelberg – from the special situations group for its newly-created mortgage real estate investment trust, TPG Real Estate Finance Trust. In January, Guggenheim, formerly president at Ladder Capital, departed to become chief executive of the new business.

In moving to Blackstone, both Yung and Nagelberg will be reunited with their former Deutsche Bank boss, Jonathan Pollack, who previously was the bank’s global head of commercial real estate and joined the New York-based alternative asset manager in 2015 as global head of BREDS, taking over from Michael Nash.

At Blackstone, Yung will be assuming the debt responsibilities of Chris Chee, a former managing director who handled both debt and equity investments on the West Coast prior to leaving the firm last fall.

Yung was the most senior professional on TPG’s real estate debt team after Guggenheim. Before joining TPG, Yung had been with Deutsche Bank since August 2007, first as a director in the commercial real estate special situations group and then as the group’s head of origination from October 2009 through December 2014, according to his LinkedIn profile. Nagelberg was a vice president at Deutsche Bank Securities from January 2011 to January 2014 and a director from January 2014 to December 2014.

Founded in 2008, BREDS managed $11 billion of committed capital as of June 30, according to its second-quarter earnings results. In August, the platform had raised $4.5 billion for its latest real estate debt fund, BREDS III, PERE sister publication Real Estate Capital reported at the time.

TPG Real Estate Finance Trust is a balance sheet lender that originates large, first-mortgage loans in select US markets. The platform currently manages a nearly $3 billion portfolio and provides financing for all major property types, according to TPG’s website.