Directed Capital has raised $92 million in equity commitments to buy commercial real estate debt.
The St. Petersburg firm specializes in working with borrowers to turn around troubled commercial real estate mortgage loans. The firm will use its newly raised funding to acquire more than $500 million in commercial mortgage loans, then work to successfully resolve the assets, a news release said.
Directed Capital recently closed on a $40 million credit facility from Pacific Western Bank. It previously received a combined $60 million in two other separate credit facilities from Goldman Sachs Bank USA, which provided $40 million, and Valley Bank, which provided $20 million, as the St. Pete Catalyst reported in May.
The company provides solutions for borrowers when traditional lenders have failed to meet their needs, said Chris Moench, CEO of Directed Capital. It also provides investors with risk-adjusted returns that are typically uncorrelated with the market, Moench said.
Moench has specialized in acquiring and repositioning debt for 30 years. There are unique circumstances for the business now.
During the economic boom, lending practices loosened and private lenders, fintech companies and other online lending platforms created easy access to capital. Lenders did not always fully vet their customers, Directed Capital’s news release said. Then the Covid-19 crisis hit, and many businesses shut down or restricted operations.
Directed Capital buys 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.
Since it was founded in 2001, Directed Capital has sponsored 10 funds and acquired more than $1.5 billion in commercial real estate loan assets. It has an office in San Diego, in addition to its St. Petersburg headquarters at the Morgan Stanley Tower downtown.