Kern leaves GE and goes solo

Jonathan Kern has left his post as president of global investment management at GE Capital Real Estate and is striking out on his own. 

Kern told PERE that he has formed Kern Investments to invest in real estate groups looking to scale up, accelerate growth or otherwise expand. He also will look to leverage his investment management experience and bring in additional institutional capital to such situations. He noted that he already is talking to a couple of groups about taking their business to the next level.

While Kern is committed to his own business, he said he also would consider joining another real estate firm if the opportunity is right. For Kern, that means a firm that is big enough and to which he can add value. Most importantly, however, the firm needs to have the right group of people, he said, adding “I would be very selective on that front.”

Kern left GE Capital Real Estate just over one week ago, having spent the past year putting in place a plan to wind down the investment management business that he helped to build. A GE Capital spokesman said Kern won’t be replaced and that his responsibilities would be divided among the firm’s three regional leaders.

Kern explained that his departure is the result of a strategic shift by GE Capital Real Estate roughly one year ago to de-emphasize its equity and investment management businesses and instead focus on real estate debt. Still, he credits the firm for giving him time to develop and implement a plan to wind down those business, allowing some investments to be managed out and others to be sold outright. For example, in February, it sold the management contract for its €240 million GE Polish Retail Fund and transferred 20 staff to Valad Europe.

Kern joined GE Capital Real Estate 10 years ago as chief investment officer and, following the global financial crisis, was selected to head up the firm’s new third-party investment management business. Prior to GE, he spent 10 years at JER Partners as co-president and CIO.