Marathon Real Estate Files $200M IPO

(Read more on the debt and equity markets.)

NEW YORK CITY-Marathon Real Estate Finance Inc. has filed papers for a $200-million initial public offering with the Securities and Exchange Commission, with plans for the public sale to go forward as soon as possible. The company filed with the SEC on May 11.

Marathon Real Estate Finance, which is managed by Marathon Asset Management LLC, has applied to qualify as a real estate investment trust and requested to be traded under the ticker symbol MRR. As a company it focuses on originating, acquiring and investing in finance transactions, like mezzanine loans, CMBS, mortgage-related securities, and credit tenant-leased real estate.

“Our objective is to generate attractive risk-adjusted total returns to our stockholders by maximizing the difference between the yield on our investments and the cost of financing these investments, thereby making cash available for distribution to our stockholders and facilitating capital appreciation,” company executives say in the SEC filing. By the time investors are allowed to purchase shares of Marathon Real Estate Finance, the company will own a $1.3-billion portfolio, which contains $886 million in assets finances in a CDO. More than 50% of the portfolio is split between New York and California, and 24.7% is in the hospitality market, while 22.7% is in office properties.

The new REIT will use its relationship with Marathon to its advantage, becoming the “primary Marathon vehicle originating, acquiring and investing in US commercial real estate debt instruments. We believe that our relationship with Marathon and our ability to leverage its relationships, market knowledge and infrastructure as well as its real estate and credit expertise will allow us to source, underwrite and evaluate attractive investment opportunities and effectively manage our investment portfolio.”

The IPO is being underwritten by Credit Suisse and Lehman Brothers.