Silo Financial Corp, a real estate specialty finance company, announced its lending business has been acquired by Knighthead Capital Management.
The deal comes in conjunction with the launch of Knighthead’s first Real Estate Fund, which will invest primarily in bridge loans and other special situation debt opportunities up to $20 million secured by a range of real estate assets throughout the East Coast and other major U.S. markets.
“We are excited to enter this business on a formal basis with an operating partner that we have had much success with over the past eight years. We believe the risk-adjusted returns in this strategy are compelling and the credit risk aspect of these loans compliments our core business, experience and expertise,” said Ara Cohen, co-founder of Knighthead.
Cohen founded his company with Thomas Wagner in 2008. It is a New York-based SEC registered investment management firm specializing in long-short event drive, distressed credit and other special situations. The closing of the $155 million Knighthead Special Situations Real Estate Fund brings Knighthead’s assets under management to approximately $4 Billion.
Knighthead Funding, LLC, has been formed to serve as the loan origination entity for the Fund.
Jonathan Daniel founded of Silo Financial in 2001, originating and closing some 140 loan transactions in 10 states with a total principal amount of approximately $230 million.
The launch of Knighthead Funding builds upon a successful track record of loan participations between the principals of Knighthead Capital and Silo dating back to 2005.
Daniel said that Knighthead Funding combines Silo’s 12-year track record in real estate loan sourcing, origination and servicing capabilities with Knighthead’s credit expertise and institutional platform.
Knighthead Funding will focus on providing high-yield commercial mortgage loans including short-term bridge loans for acquisitions, refinances, construction, turnaround/work-out situations, note acquisitions, foreclosures and bankruptcies secured by assets across a variety of property types.
“We will expand on the original Silo platform through Knighthead Funding by having institutional support for an existing platform with previously proven results,” added Daniel, principal at Knighthead Funding.