Directed Capital, a national opportunistic real estate finance firm that acquires and strategically repositions commercial mortgage loans, today announced it has closed its tenth flagship fund, raising $92 million in equity commitments that will be deployed to purchase commercial real estate debt. The firm will seek to acquire more than $500 million in commercial mortgage loans, then work to successfully resolve the assets, creating value for the partnership, while also providing borrowers with the flexibility to work out their debt, and in many cases help to continue their business operations.
Directed Capital recently closed on a $40 million credit facility from Pacific Western Bank and previously received a combined $60 million in two other separate credit facilities from Goldman Sachs Bank USA ($40 million) and Valley Bank ($20 million), which will facilitate the continued acquisition of commercial real estate loans.
“Directed Capital takes great pride in being able to provide solutions to borrowers when traditional lenders have failed to meet their needs,” said Directed Capital CEO Chris Moench, who has specialized in acquiring and repositioning debt for 30 years. “Being able to aid Main Street, while providing investors with superior, risk-adjusted returns typically uncorrelated with the market, is well in line with the longstanding tradition of this firm of doing good, while increasing investor returns. In addition, from our experience dating back to the early 1990s, we believe the current market dislocation will result in outsized opportunities for Directed Capital and its investors.”
Directed Capital helps small and middle market businesses weather unexpected events that place financial stresses on otherwise healthy businesses, and creates superior returns for its investors in the process. As lending practices loosened during a booming economy, a rise in private lenders, fintech companies and other online lending platforms created easy access to capital, often leading to lenders not fully vetting their customers. That, coupled with the events surrounding the COVID-19 pandemic, has created additional opportunities and expanded an existing and steady stream of product for Directed Capital to opportunistically acquire commercial mortgage loans. It then assigns its team of 35 experienced professionals and portfolio managers to develop practical, effective loan workout solutions, build solid relationships with borrowers, and develop plans to reposition the loans.
The fund’s first investor distributions will begin in the third quarter of this year.