SKW Funding, a private lending and distressed debt platform, and Bain Capital Credit, announced the formation of a joint venture that will target sub- and non-performing notes.
The JV will target $500 million of acquisitions over the next two-and-a-half years.
Concurrently, the venture announced its first acquisition, a $27 million portfolio of four non-performing notes secured by 652 garden-style apartment units in San Antonio, Texas.
SKW Funding is led by Daniel Wrublin and Andrew Wrublin of Dalan Management, and Ayush Kapahi and Jerry Swartz of HKS Real Estate Advisors. Bain Capital Credit is a leading global credit specialist with approximately $41 billion in assets under management.
The JV will seek opportunities nationally, with a focus on acquisitions in the greater New York City market. SKW Funding and Bain Capital Credit will also target special situation loan originations including mezzanine and preferred equity investments.
“With the slowdown in transaction volume and the recent rent law changes in New York City, we see this as an ideal time to provide solutions to borrowers looking for structured capital, and to lenders looking to sell off their assets/loans due to market conditions and regulatory pressure,” said Kapahi.
“While the U.S. real estate capital markets remain robust, we are seeing idiosyncratic, borrower-driven distressed situations and signs of late-cycle lender fatigue that we believe will lead to increased opportunities in non-performing loans,” said Jeff Robinson, a Managing Director and Global Head of Bain
Capital Credit’s Distressed and Special Situations Group.