Starwood Capital Group, the Greenwich, Connecticut-based private equity real estate firm, has formed a European real estate debt platform. Starwood European Finance – or StarFin for short – would be Starwood’s third major debt platform following two in the US that has so far lent more than $10 billion.
StarFin will be led by the Starwood European management team, including Jeff Dishner, a senior managing director. As revealed by PERE last August, Dishner relocated from the US to London as global head of real estate acquisitions in order to take advantage of opportunities in Europe.
The other senior professional is Peter Denton, head of European debt, who said in a statement: “Starwood was established in 1991 in the depths of that real estate downturn. In good times and bad we’ve built a track record in real estate financing via large debt platforms. We’re looking forward to expanding our presence in the European financing market.”
Also revealed in today’s announcement is the involvement of Cushman & Wakefield Investors as a backer of Starfin. Cushman & Wakfield Investors is the London-based real estate investment management arm of real estate broker and services firm, Cushman & Wakefield.
Carlo Barel di Sant’Albano, chief executive officer of Cushman & Wakefield EMEA, said: The debt funding gap is undeniable and offers striking opportunities. This partnership means we’ll combine our market intelligence and extensive European platform with Starwood Capital’s expertise and experience in the real estate debt market.”
The new company will focus on the UK and northern parts of Europe and will follow a “broad loan origination business”, lending directly to property owners, as well as acquiring parts of loans made by other lenders. It will invest across a combination of senior, whole, subordinated, bridge and development loans with a maximum portfolio loan-to-value of 75 percent. Typical loan sizes will be from €40 million for whole loans and from €20m for subordinated loans, though it could enter into larger loans across the industrial, office, retail and residential sectors.
There was no additional detail offered, but one report today suggested Starwood was planning a fund for its lending activities that would be listed on the London Stock Exchange. The company declined to comment on the report.
However, in the US, Starwood has chosen the public route for its real estate debt vehicles.
Starwood Property Trust, which is advised by Starwood Capital Group, is the largest US commercial property-focused mortgage REIT. According to the company, the US REIT has already been “pursuing lending opportunities” in Europe. Starwood Property Trust will now co-invest alongside StarFin leveraging the resources of both entities, it said.