Select Page

KAYNE ANDERSON REAL ESTATE ADVISORS

Overview

Kayne Anderson is a premier alternative asset manager headquartered in Los Angeles with offices in Atlanta, Boca Raton, Chicago, Dallas, Denver, Houston and New York. It currently manages (as of December 31, 2015) over $20 billion in assets, across six distinct strategies, with over 300 employees.

The Opportunity

(Available for Qualified Purchasers- $100k Minimum)
Introduction
Kayne Anderson Real Estate Debt, L.P. (KARED) is the first fund organized by Kayne Anderson Capital Advisors, L.P. to invest in commercial real estate debt and securities that are secured by assets in sectors with attractive investment characteristics. KARED is expected to invest in commercial real estate debt and securities, primarily Freddie Mac “K-Deal” B-Pieces and mezzanine debt/preferred equity, secured by assets predominantly in student housing/multifamily and healthcare-related (primarily senior housing and medical office) real estate.
The investment strategy of KARED follows Kayne Anderson’s core investment philosophy which is oriented toward absolute returns, a focus on niche strategies and markets that require specialized knowledge and sourcing advantages, and a strong emphasis on the preservation of capital. By doing so, KARED seeks to achieve strong risk-adjusted returns through compelling current yield and preservation of invested capital.
The Firm
Kayne Anderson is a premier alternative asset manager headquartered in Los Angeles with offices in Atlanta, Boca Raton, Chicago, Dallas, Denver, Houston and New York. It currently manages (as of December 31, 2015) over $20 billion in assets, across six distinct strategies, with over 300 employees.
The Opportunity
The primary opportunities are Freddie Mac “K-Deal” B-Pieces and mezzanine debt/preferred equity, secured by assets predominantly in student housing/multifamily and healthcare-related real estate, particularly senior housing and medical office and care facilities. KARED possesses distinct advantages when investing in these commercial real estate debt and securities due to sourcing advantages that include a strong relationship with Freddie Mac, a track record of successfully acquiring Freddie Mac “K-Deal” B-Pieces and the differentiator of having a 40+ person vertically integrated real estate equity team with operating capabilities in the target sectors.
 High barriers to entry. KARED has established access to Kayne’s long-standing active relationship with Freddie Mac and its operating capabilities
 Attractive current yield. Significant spread widening has occurred since mid-2015 allowing for attractive risk-adjusted returns
o June 2015 B-Piece Yield: One-month LIBOR +8.1%
o June 2016 B-Piece Yield: One-month LIBOR +10.75%
o Strong pipeline. Freddie Mac anticipates issuance of over $50B for 2016. This translates into approximately $4B of annual B-Piece issuance with expected continued growth
Factors contributing to the opportunity
 Global macroeconomic stress and volatility are causing uncertainty in the capital markets. Subordinate debt providers are widening pricing and/or reducing leverage on direct loans to protect against volatility in the capital markets.
 Shrinking liquidity combined with heavy supply has put pressure on both private label and agency commercial mortgage backed securities (“CMBS”) spreads. Liquidity has been an issue as dealers are required to hold more capital against their books and are being discouraged from risk taking. Dealers have been net sellers of CMBS and are not making markets as actively as in the past.
For Institutional/Investment Professional Use Only
Not for Public Distribution
 Despite recent improvements, the recovery over the past few months has been more pronounced for higher rated bonds. Lower rated bonds have not recovered as well and Freddie Mac floating rate B-Pieces remain near all-time wide levels
In spite of these issues, real estate equity fundamentals and liquidity have remained strong and these current opportunities are capital markets driven and technical in nature.

Documents

o

Click here for PDF

o

Click here for PDF

o

Click here for PDF

o

Click here for PDF

This Area is Widget-Ready

You can place here any widget you want!

You can also display any layout saved in Divi Library.

Let’s try with contact form: