Achi news desk-
(Bloomberg) — Mavik Capital Management LP is looking to raise $515 million to fund U.S. middle-market commercial real estate, an area constrained by a lack of liquidity as regional banks withdraw from the space.
The company aims to achieve an internal rate of return of 15% to 25% with the new fund, called Mavik Real Estate Special Opportunities VS2, according to a person with knowledge, who asked not to be identified at discuss the matter. That rate of return would be similar to the returns obtained on an earlier fund.
The opportunistic real estate investment firm, which recently led a $75 million investment to recapitalize the Waldorf Astoria in Washington, formerly the Trump International Hotel, is creating the vehicle as regional banks retreat amid tougher regulatory requirements and higher interest rates . That has pushed borrowers who need to refinance maturing commercial property loans into the arms of private credit lenders, who have been eager to make those loans given the high interest rates they can charge.
Bond investors have punished banks with heavy exposure to commercial real estate, adding even more pressure on lenders’ profits as Wall Street scrambles to assess how widely property debt pain will spread through the financial system. .
Fortress Investment Group co-chief executive officer Joshua Pack recently said he sees a $1 trillion opportunity for investors in distressed assets, and in one recent example KDM Financial is looking to raise $350 million to invest in multifamily bridge loans and other types. of commercial property loans.
Mavik’s investors include pension funds, family offices and institutional investors, including Blackstone. Blackstone got involved in the company back in 2021, when Mavik was already looking to capitalize on stress brought on by the Covid-19 pandemic.
Mavik, formerly known as Terra Capital Partners, focuses on commercial real estate credit and special situations. It has approximately $1 billion in assets under management.
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