Evans Randall has formed a joint venture with the National Bank of Abu Dhabi to invest in mezzanine investments in the UK and German real estate markets.
The JV, which will target $500 million, will have internal rates of return of up to 20 percent, according to media reports. The JV aims to pay annual cash returns to investors of between eight and 12 percent.
The liquidity squeeze was presenting good opportunities for firms able to fill the gap in the capital stack left by banks leaving the mezzanine debt space, Michael Evans, Evans Randall chairman and chief executive said. “With increased conservatism on the part of banks in the short to medium term, and the longer term shift in regulatory capital aspects of such investments, ongoing opportunities are available for investors able to originate and provide such financing,” he added.
In July, the London investment bank and private equity firm, established a €625 million ($984 million) mezzanine and preferred equity group to target leveraged property transactions and B-note holders in the UK, Europe, the Gulf States and Asia.
The firm poached five people from San Mateo, California-headquartered property finance firm Capmark Finance to form the new business called Evans Randall Capital Partners.
Andrew Haines, Capmark’s former head of UK and Europe lending in Capmark's London office is leading the new group along with Sam Mellor. Duncan Elley, associate director, Leon Sodeyfi, associate, and Sarah-Kay Ritchie, executive assistant, complete the group.