Regent Properties launched a $500 million credit initiative aimed at offering commercial real estate owners additional financing in what has been called one of the toughest real estate lending environments in decades.
The real estate investment firm unveiled plans two years ago to invest $2 billion in real estate acquisitions in the Lone Star State and the southern United States, with plans to use its dual headquarters in Dallas as an investment springboard. The launch of the firm's $500 million credit platform, anchored with a commitment from a Texas-based ultra-high net worth family office along with other limited partners, aims to target "high-quality sponsors, borrowers and assets primarily in major Sun Belt markets," executives said.
Regent Properties CEO Eric Fleiss said the company's move into credit is a natural extension of its commercial real estate investment and development strategies.
“We understand these assets and our target markets intimately and have already established what we believe is a robust pipeline of opportunities given our existing and extensive network and reputation in the industry," Fleiss said in a statement. "We expect our first several credit transactions to close over the next several quarters.”
Regent's new credit platform was created to execute on senior secured debt, mezzanine debt and preferred equity investments secured by residential, office and retail properties. Executives at the firm anticipate the credit transactions to include a combination of acquisition financing, refinancing and structured rescue capital. In some select transactions, the firm could also finance construction renovation and leasing efforts, executives said, offering the ability to unlock new avenues for growth.
Regent's executive vice presidents, Patrick Devitt and Alan de Castro, will lead the strategy, which includes origination, underwriting, due diligence and execution. Devitt is based in Los Angeles and oversees the firm's western region. De Castro is based in Dallas and oversees Regent's eastern region, which includes the Texas markets.
As capital markets continue to evolve, Sam Kraus, chief investment officer at Regent Properties, said the need for flexible and accessible financing solutions has never been greater.
"Regent intends to provide liquidity to CRE sectors that are significantly underserved,” he added. “For our investors, we believe this new platform provides a compelling return profile in a protected position in the capital stack — and the ability to invest alongside an established real estate manager.”