Research shows that loans in the amount of approximately $1 trillion will mature in the next couple of years and will generate high demand for lending capital. As capital supplied by traditional lenders continues to be impacted by increased regulation and ongoing spread volatility, opportunistic buyers and investors in transitional assets will require flexible debt capital tailored to their business plans.
Erez Capital has identified this business opportunity and is moving forward to partner with leading global alternative investment funds with a dedicated team of multi-disciplinary real estate professionals. The funds offer financing across a broad spectrum of property types, focusing on first mortgage. Those funds has the infrastructure and enhanced ability, thanks to their structure, to underwrite, implement an investment process that emphasizes rigorous due diligence and “cradle-to-grave” asset management, including foreclosure events.
Case study - AllianceBernstein - Commercial Real Estate Income (the “Fund”)
Erez partnered with AB commercial real estate debt team (״Team״) from AllianceBernstein (NYSE:AB) (“AB”) to raise finances for the Fund
AB is a global asset management firm, with $463B in assets under management, providing investment management to institutional, high-net-worth and retail investors.
The Fund will focus on first mortgage loan investments, with 65%-70% LTV secured by high-quality properties, with yield ranges between L+4% to L+5.5%. The Fund’s leveraged structure will increase the yield to over L+9%
The Fund structure would allow to pay interest to Israeli investors with no US nor Israeli tax
The investors profile will consist from majority of US based investors
The Team will enjoy an established platform, with in-place infrastructure, policies and procedures that have been refined based on Team’s experience and enhanced by AB’s global resources. This enhance competitive advantage will address:
Balances its opportunistic investment philosophy with an investment process that emphasizes rigorous due diligence and strategic asset management, with great experience in case of foreclosure events
The loans are structured significant reserves, attractive prepayment terms and interest-rate protection
Team is currently managing 2 unleveraged funds with approximately over $2B in commitments from various investors, primarily insurance companies, sovereign-wealth funds and high-net-worth clients of AB Global. Commitments in the amount of $1.2B were raised in less than 12 months.