Loan to own firms
What are some of the top loan to own firms in the industry? Is it major private equity and hedge funds like Lone Star, Cerberus, Apollo, Angelo Gordon, Ares, etc or smaller middle-market firms?
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Romspen does I think. Also Madison Realty Capital even perhaps (situationally)
Rompsen is doing terrible
MRC is no longer a loan-to-own platform—they now have capital from sovereign wealth funds, insurance companies, and other institutional investors. The deal team originates attractive construction deals and will often syndicate participations to groups like Axonic.
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Does Bain cap credit fall under this?
Interesting strategy and curious to see if there’s larger firms that loan with the intention to own. Imagine it’s muddled with legal concerns and drawn out arguments but that it could be quite lucrative.
Rialto capital
Madison realty capital
I would also say all of the larger development firms that have debt fund arms. Their first intention is to get repaid but if they have to take the asset over at 65 cents on the dollar, they are more than capable of doing so.
No one actually “loans to own”. Even when you’re doing super risky credit deals, you want the property to perform well and get repaid normally. The only time you truly loan to own is when you buy a NPL with the intention of foreclosing, but that would be done out of an equity strategy
My firm buys NPLs at discounts and our plan is to foreclose or get paid off at par shortly after loan acquisition. We are an equity strategy and I’m seeing more people entering this space. However, it’s important to know that you could be in a long legal battle and your IRR is time driven so you have to get title as fast as possible.
Maverick
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