$200M Bascom Fund Targets Troubled Loans

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IRVINE, CA-The Bascom Group, which started out 10 years ago by turning around troubled apartment buildings, has now turned its attention to troubled loans in the multifamily sector. Bascom and New York City-based Warburg Pincus Real Estate I have launched a $200 million fund to invest in non-performing loans and distressed multifamily properties.

Bascom co-founder Jerry Fink says that some borrowers of high-interest-rate conduit loans that originated in the 1990s “are struggling” to repay loans due to high defeasance costs and concerns over high loan-to-value ratios. According to David Kim, also a Bascom co-founder, the new venture with Warburg Pincus presents a value-added opportunity for Bascom while offering loan originators and note holders a chance to “quickly and seamlessly dispose of distressed assets” because the new fund can close on an all-cash basis.