Cain International, a privately held investment firm with over $15 billion in assets under management, has agreed to buy Pacific Western Bank’s New York real estate construction loan portfolio for $1.2 billion.
Cain International, in partnership with Security Benefit Life Insurance Co., will acquire from PacWest 10 loans in New York, with a focus on multifamily and student housing developments. The aggregate principal balance of the portfolio is about $500 million, Cain said Friday in a statement.
“This marks a significant moment of growth for Cain’s U.S. lending platform and underpins our belief that high-quality projects, delivered by high-quality developers, will continue to thrive amidst transitory headwinds,” Jonathan Goldstein, CEO and co-founder of London-based Cain, said in the statement, adding the firm remains “confident in the tenacity of urban markets.”
Cain has originated over $7 billion of real estate debt since its founding in 2014. In 2019, it arranged a $750 million construction loan for the development of the Aman New York luxury hotel in what it bills as one of the largest financing deals in New York in recent years. It also offered financing to the Research and Development District, a 1.7 million-square-foot life science campus in San Diego, as well as to Lendlease’s The Reed, a 415,100-square-foot, 440-unit residential tower in Chicago’s South Loop neighborhood, Cain said.
PacWest’s deal comes as the firm, in need of cash following withdrawals and turmoil among regional banks, recently agreed to sell 74 construction loans for $2.4 billion to global real estate investor Kennedy-Wilson Holdings.
For PacWest, based in Beverly Hills, California, these transactions marked a continuation of strategic asset sales the bank began exploring when customers withdrew $2.7 billion in deposits in March after the banking failure of Silicon Valley Bank rattled markets.
Higher interest rates among other factors have led to the collapse and government takeover of Silicon Valley Bank, Signature Bank and First Republic Bank, which has been sold to U.S. banking giant JPMorgan Chase.