Tags: starwood | commercial

Starwood Starts Big Comm. Real Estate Fund

By    |   Tuesday, 09 Jun 2009 01:39 PM

While some investors are avoiding commercial real estate like the plague, hotel legend Barry Sternlicht isn’t one of them.

He just formed Starwood Property Trust to write and invest in commercial real estate mortgages,

The company plans an initial public offering to bring in up to $500 million.

Sternlicht is chief executive of the firm. He was chairman of Starwood Hotels & Resorts Worldwide from 1997 to 2005, helping to make it the third-biggest hotel company in the U.S.

The fund will take advantage of the credit crisis to acquire distressed assets.

“The next five years will be one of the most attractive real estate investment periods in the past 50 years,” Starwood Property said in a regulatory filing, cited by Bloomberg.

“We believe that there will be a significant supply of distressed investment opportunities from sellers and equity sponsors of real estate, including national and regional banks, individuals, insurance companies, finance companies, fund managers and other institutions.”

For its investments, Starwood will initially look at loans sold by the government's public-private investment program (PPIP) and the Federal Deposit Insurance Corp.

Not everyone is so enthusiastic about commercial real estate. Many experts say that sector will be the next shoe to drop for banks and the economy.

At a recent hearing of the Congressional Oversight Panel, Deutsche Bank analyst Richard Parkus said two-thirds of all commercial real estate loans due in the next few years could go bust, Time magazine reports.

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While some investors are avoiding commercial real estate like the plague, hotel legend Barry Sternlicht isn’t one of them.He just formed Starwood Property Trust to write and invest in commercial real estate mortgages, The company plans an initial public offering to bring in...
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Tuesday, 09 Jun 2009 01:39 PM
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