JCR Capital, a Denver-based commercial real estate finance company founded by a former managing director of GMAC, has held a first close for a small fund.
The firm, which is hoping to garner $25-30 million of commitments, said investors so far included New York and Los Angeles private equity firm, JAM Equity Partners, PartnerRe Capital Markets, a Greenwich, Connecticut based subsidiary of Bermuda-based reinsurance company, PartnerRe, and Denver money manager, Branzan Investment Advisors.
The firm is raising the JCR Capital Distressed & Opportunistic Real Estate Fund to provide debt, preferred equity and equity to distressed and opportunistic real estate transactions.
Jay Rollins, president at the firm, said in a statement, that a supply and demand imbalance existed in the commercial real estate finance market which had created the “most attractive investment environment since the previous dislocation during the RTC era”.
He added: “The waves of maturing debt on commercial real estate are just beginning and the capital markets have not yet recognised their losses. The opportunities to provide capital at a reset basis are now starting to appear and will last for some time. We believe that seasoned providers of capital, and those who do not have any legacy assets, will be well positioned to take advantage of the current environment.”
In particular the fund will target existing borrowers, “contract purchasers” and “legacy lenders”.
The fund will focus on small transactions of between $1 and $10 million. “We believe there is more opportunity in smaller transactions at this time,” said Rollins. “There is less competition and exit strategies are easier to achieve because there is more liquidity in the small balance market.” For larger transactions, JCR would use LP co-investment capital and would team up with a long time managed account relationship.
Rollins founded JCR in 2006 after leaving GMAC's Commercial Mortgage Structure Products Group, where he was managing director.