NEW YORK CITY—Mack Real Estate Group saidWednesday that it had expanded the sphere of its debt activitiesvia the launch of a lending platform for transitional anddistressed assets. Managing this business will be the newly formedMack Real Estate Credit Strategies, with MREG CEORichard Mack heading the new venture along withCIO Peter Sotoloff, formerly of theBlackstone Group.

Mack cites three reasons for launching MRECS. “First, webelieve that the returns currently available for loans secured bytransitional assets in the US, and for almost all European assetslocated outside of the very few top-tier cities, will be superiorto most other real estate investments, on a risk-adjusted basis,”he says.

Second, Mack cites the fact that Sotoloff, “whom we consider thebest real estate debt professional in the market,” has agreed tojoin the new venture. “Third, we are now able to invest withpartners who supported us in our past businesses. We believe thatthey see the merits of continuing our previous, very successfulreal estate lending program, which was nearly unique in continuingto provide very positive returns even through the lastdownturn.”