Kennedy Wilson has entered into an equity joint venture with PCCP to acquire a large apartment complex in Alameda, California. The venture, which is the third between the two firms, purchased an all-equity interest in Summer House Apartments for $86 million including senior loan debt, restructuring a three-year bridge loan with Bank of America to capitalise the deal.
PCCP senior vice president Rob Cohen said in a statement the deal had allowed the firms to “invest new equity into an over-leveraged capitalisation with accretive assumable debt”. Robert Hart, president and chief executive officer of Kennedy Wilson Multifamily, added the deal boosted their Northern California multifamily portfolio to more than 2,500 units. Neither firm was available for additional comment.
Kennedy Wilson, which has five active value-added and opportunistic discretionary funds and more than 10 separate accounts targeting the US, Hawaii and Japan, was taken over by David Minella’s special purpose acquisition company (SPAC) Prospect Acquisition Corp. in November last year. As part of the take-over it was revealed Prospect could pump $198 million of cash into Kennedy Wilson, with $145 million being used as fund, joint venture and separate account co-investment capital and $22 million to pay down debt.
Kennedy Wilson chairman and chief executive officer William McMorrow told PERE in 2009 the firm would be an active player in targeting distressed commercial and residential assets, particularly in California and Japan, over the coming months and years.
PCCP, the West coast debt shop formerly known as Pacific Coast Capital Partenrs, in 2009 acquired the two real estate mezzanine funds of Lehman Brothers, Lehman Brothers Real Estate Mezzanine Partners I and II, renaming them PCCP Mezzanine Recovery Partners I and II.
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