Source: Real Estate Alert
June 13, 2001
T- Rex Capital, an investment firm headed by former Starwood Financial executive Thomas M Mulroy, is looking to raise $250 million of equity for an opportunity fund that will invest in properties and mezzanine debt.
The vehicle will target properties valued at $50 million to $100 million that sellers such as REITs looking to raise capital , are in a hurry to unload. T-Rex will be able to pull the trigger quickly on deals because its top managers-including Mulroy and co-founder Cliff Preminger-will have full investment authority. It willalso be on the prowl for mezzanine loans, one of Mulroy’s specialities at Starwood.
Since being formed in January 2000, the New York-based company had raised equity on a project-by-project basis to buy nine telecommunications properties encompassing 6 million square feet, including a 1.8 million-sf facility in Boca Raton, Fla. This will be the firm’s first commingled fund for multiple investments. Fund-raising is expected to begin in August or September.
The fund will be able to invest up to $825 million through the use of as much as 70% leverage. The managers are targeting annual leveraged returns of more than 20%. Investments will be made in major cities throughout the U.S., with holding periods of three to five years.
T-Rex has done some joint ventures with Angelo, Gordon and Company of New York, Lubert-Adler Partners of Philadelphia and other opportunistic firms.
Last year, the company merged with Terremark Worldwide of Miami, a public real estate firm specializing in telecom hotels. Now the Terremark is focusing on the telecommunications business itself, T-Rex has separated from Terremark in order to independently pursue telecom-related real estate deals.
Mulroy was a senior vice president of Lazard Freres before joining Starwood as a senior vice president in 1998.