New York-based Dwight Capital has launched a new commercial real estate rescue fund targeted toward sponsors seeking to refinance existing debt in the face of equity shortfalls.
The firm, along with its affiliate Dwight Mortgage Trust, will originate mezzanine debt and preferred equity on a broad swath of properties across the US. The fund will look at assets in the multifamily, mixed-use, office, retail, independent living and assisted living sectors with values of $10 million to $75 million.
“Given the unprecedented number of loan maturities coming due in the next year, we want to be there to help our partners get through this period of lower-than-expected proceeds and higher than expected rates by providing them with solutions that will help them bridge the gap to recapitalization and future stabilization by providing them with creative financing solutions,” said Adam Sasouness, co-founder of Dwight Capital and Dwight Mortgage Trust.
Dwight Capital believes today’s higher interest rate environment means a significant percentage of loans closed over the past few years won’t be able to secure cash-neutral financing. This will particularly be the case for floating-rate bridge loans, the company said in a statement.
“Together with our existing bridge loan and construction lending products, the added preferred equity and mezzanine capabilities will assist Dwight Mortgage Trust in deploying over $2 billion of new loan originations in 2023,” said Tim Groves, chief investment officer.
The firm will work with Miami-based 27 Capital on the strategy.