LOS ANGELES-Kearny Real Estate Co. has acquired a $196 million portfolio of performing, sub-performing and non-performing loans in a partnership with Morgan Stanley Real Estate Investing. Managing partner Jeff Dritley of L.A.-based Kearny reports that the portfolio, composed of 45 assets, is secured by properties in California, Nevada, Washington, New Jersey and New York, announced.
The properties include residential condominiums, apartments, retail, commercial office, industrial and land zoned for residential use. The portfolio includes 25 assets in California (21 loans and four REO). Notable assets include loans on new condominium projects in Northern and Southern California, a loan on a new cold storage warehouse in Los Angeles and the historic Col. Fletcher Building in Downtown San Diego. The four-story, 48,000-square-foot Col Fletcher Building was built in the early 1900s and was redeveloped into office condominiums in recent years.
In the past six months, Kearny has acquired approximately $360 million of distressed debt in three separate transactions with a goal of $1 billion by year end, according to Dritley. Kearny has added four new employees in the last six months and will add two more shortly to handle this significant increase in assets.
"Many of these troubled loans were more the result of the depressed credit market and the economic downturn than the underlying asset," says Dritley. "As the market begins to stabilize, we have the resources and experience to create value for this portfolio."