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Cheyne Hires Barclays Veteran for $2 billion Synthetic Risk Push

Cheyne Capital has hired Frank Benhamou, the former head of capital and structured funding solutions at Barclays Plc, as the alternative investment firm plans a $2 billion synthetic risk transfer strategy.

Benhamou, who was a managing director at Barclays, starts on Monday at London-based Cheyne Capital as portfolio manager for risk transfer strategy, according to a person familiar with the matter who asked not to be named because the details aren’t public. Benhamou joins after 17 years at Barclays, where he set up and led the bank’s Colonnade Programme, one of the world’s largest SRT platforms, according to his profile on Linkedin.

Cheyne Capital last week said it had re-entered the SRT market after a break of about six years. A portion of the $2 billion target has already been invested in several SRT transactions earlier in the month, according to the person. Founded in 2000, the firm has over $11 billion under management in asset classes including real estate, credit and equity.

Benhamou didn’t respond immediately to an emailed request for comment on Monday.

Cheyne Capital has hired Frank Benhamou, the former head of capital and structured funding solutions at Barclays Plc, as the alternative investment firm plans a $2 billion synthetic risk transfer strategy.

Benhamou, who was a managing director at Barclays, starts on Monday at London-based Cheyne Capital as portfolio manager for risk transfer strategy, according to a person familiar with the matter who asked not to be named because the details aren’t public. Benhamou joins after 17 years at Barclays, where he set up and led the bank’s Colonnade Programme, one of the world’s largest SRT platforms, according to his profile on Linkedin.

Cheyne Capital last week said it had re-entered the SRT market after a break of about six years. A portion of the $2 billion target has already been invested in several SRT transactions earlier in the month, according to the person. Founded in 2000, the firm has over $11 billion under management in asset classes including real estate, credit and equity.

Benhamou didn’t respond immediately to an emailed request for comment on Monday.

Read more: Hedge Fund Polar Taps BMO Credit-Risk Transfer Expert Leclerc

Significant risk transfer transactions — also known as synthetic risk transfers — allow banks to buy protection on their loan portfolios in order to release regulatory capital or manage risk. Last year, banks around the world sold $25 billion of SRTs, partially offloading the risk of $300 billion of loans, according to an estimate by Pemberton Asset Management.

While European banks have been the biggest users of such transactions in previous years, the largest increase in SRT volumes is likely to come from large Wall Street banks, though that could depend on how stringent US regulators decide the latest regulatory capital requirements, known as Basel III Endgame rules, should be.

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ADIA earmarks USD 1 bn for Barclays, AGL private credit vehicle

The Abu Dhabi Investment Authority (ADIA) is pouring USD 1 bn into Barclays and AGL Credit Management’s new private credit fund, Bloomberg reports, citing a source familiar with the matter. With Adia’s backing, the fund now holds more than USD 2 bn of dry powder ready for deployment. The three firms declined to confirm the exact size of the investment.

ADIA and AGL go way back: Founded in 2019, AGL was launched with a USD 500 mn investment from Adia, making the sovereign wealth fund a shareholder in the credit investment firm.

ADIA is stepping up its private credit investments: ADIA recently said it is ramping up its commitment to London-based alternative asset manager Cheyne Capital’s capital solutions strategy to GBP 650 mn, as a “compelling investment proposition in a market that is looking to private credit lenders for capital,” Executive Director of ADIA’s real estate department Mohamed Al Qubaisi said. ADIA previously ventured into private credit in September, backing a USD 5 bn fund launched by Wells Fargo alongside asset manager Centerbridge and making a USD 932 mn investment in Australian real estate private credit company Qualitas Diversified Credit Investments.

About the vehicle: The private credit fund will operate as an independent manager with a primary focus on investments in senior secured debt and offering private credit financing to major corporate borrowers, Bloomberg reports, citing a statement it has seen. The fund will give AGM “complete control” over origination, asset selection, portfolio construction and portfolio management .

AGM will hold full control under an agreement with Barclays, which will give AGL access to all of Barclays’ entire private credit portfolio. The agreement will allow AGL to choose to participate in the credit financing transactions, which will help AGL “benefit from more information than other pure-play direct lenders and asset managers,” AGL Chief Executive Peter Gleysteen told Bloomberg.

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Bearbull Portfolio: A new buy just for the Isa window

Last week, this column played host to a duel between two investment heavyweights. In the red corner, Jeremy Grantham’s GMO, which in atypical fashion had just stated its “excitement” at the opportunity set across equities, especially in the boxes marked value, small-cap, and non-US. To the oft-bearish asset manager, today’s conditions present the “best relative asset allocation” options since the collapse of the Soviet Union. Fundamentals? Back with a bang.

In the blue shorts, we had Jonathan Ruffer, pondering the end of the equity era and a sustained period of painful de-leveraging, corporate fire-fighting and disenchanting returns ahead. Ruffer’s long-held investing maxim – to not lose money, rather than maximise returns – echoed loudly. Those fundamentals? A second-order priority to a deteriorating macroeconomic backdrop.

With 5 April and the window on my use-it-or-lose-it individual savings account (Isa) allowance fast approaching, I was suddenly foggy with indecision. The goal of the Bearbull Income Portfolio, as I recall, has always been to use equities to simultaneously grow capital and draw on (an ideally also growing) stream of dividends as a modest prop to day-to-day expenditures. On one reading, this might be a bona fide moment to double down. On another, is a much grander rethink due?

The portfolio’s recent run has been fair. In the past two-and-a-bit months, accumulated dividends and capital growth has pushed up its total value by a handy 3.5 per cent. A few one-time deadweights (GSK (GSK), Anglo American (AAL), Johnson Matthey (JMAT)) are looking sprightlier, while the funds-led engine I built at the end of 2023 has been doing the job set for it.

Then again, given the likelihood of a trundling performance from the UK economy, we might need to temper any GMO-inspired hopes for domestic equities. In truth, however, what keeps me up at night as much if not more than the portfolio’s holdings are the prospective returns on fixed income. My internal debate is less to do with the dominant stocks-versus-bond narrative about relative value – given that this usually compares a pricey US equity market and high-yielding Treasuries – but a more humdrum British fretting around the various opportunities in gilts.

It is the thought of that sweet spot of modest income and capital growth (not winning exactly, but decidedly not losing money) that is so hard to ignore. More power to Ruffer.

Especially tempting are those five-year gilt issues, sold when interest rates were improbably low in 2020 and 2021, and still trading at a discount to par. Though their coupons are slight, this merely creates a cash flow timing issue, which is manageable; hold to maturity, and the eventual climb to redemption prices should offer a real return almost free of risk and entirely free of capital gains tax. I could be done with Isa fretting, and company monitoring, all in one go.

If I’m honest, becoming an amateur bond watcher would probably be my preference to investing with Ruffer. That’s not because I think I’d do a better job (though their fees would give me a head start). Rather – judging both by his comments and the rather flat performance of the Ruffer Total Return fund since a new market paradigm started to emerge three years ago – it’s not wholly clear whether the end-of-the-equities-era thesis makes obvious winners out of other asset classes. If inflation proves sticky, those real gilt returns might prove rather unreal.

So, I’m going to leave Ruffer’s warning semi-unheeded. Or rather, I’m going to take the middle way between his sticky inflation call and GMO’s rosy base-case return to lower interest rates.

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2 dividend stocks to take me from £0 to £9.5k in second income

Beginning an investing career from a standing start is never easy. Yet for many, that’s the way it has to kick off. And investors are waking up to the fact that it’s possible to make a second income from dividend stocks even when they have no savings. If I was starting from £0, here’s how I’d go about trying to turn that into a generous annual stream.

The real deal

One stock I’d look to include in my portfolio would be Real Estate Credit Investments (LSE:RECI). The stock is down 13% over the past year, with a current dividend yield of 10.39%.

The business invests in real estate debt secured by commercial or residential properties in the UK and Europe. Therefore, it differs from a real-estate investment trust (REIT) in that it doesn’t own the properties, but rather helps to fund purchases of them.The dividend yield is very high, with regular quarterly income payments. Of course, with a yield this high, there must be risk involved. This is the case, investing in debt in the property market right now can be difficult! Property developers are struggling under the burden of high interest rates. Some are going bust because they can’t afford the repayments. If enough go bust that are within the fund, it could really hamper performance.

Based on the track record, I think the management team that runs the fund can navigate these murky waters. If interest rates fall, this will certainly help the share price to recover as sentiment improves.

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Dominus and Cheyne Capital announce acquisition of 65 Fleet Street

Dominus, a investor, developer and asset manager in the alternative living and hotels sectors, and Cheyne Capital have acquired 65 Fleet Street in a JV to redevelop the property.

The partners have ambitious plans for the site to introduce a mix of uses that will add to the life and dynamism of the City of London.

Several uses are being explored for the site; and it is envisaged that the redevelopment will make a significant contribution to the wider Fleet Street quarter.

The current plan is for the historic façade onto Fleet Street to be reworked and upgraded with materials and detailing more in keeping with the surroundings.

Redevelopment works will also safeguard and celebrate the Grade II-listed Whitefriars Crypt with new access routes and increased visibility.

The Tipperary Pub, a vital community meeting place, has been renovated and re-opened, bringing it back into use after almost four years of closure.

Seeking to deliver community benefit as soon as possible, Dominus is operating the pub and will secure long-term viability.

The redevelopment will also include the opening of ‘Tattle at The Tipperary’, an independent coffee shop, and ‘Florist at The Tipperary’.

Both meanwhile uses will be operational throughout the redevelopment and help to reactivate the street frontage and broaden the offering on Fleet Street.

The development will reuse as much of the building’s fabric as possible while creating a highly efficient external envelope.

This is the first JV acquisition by Dominus, following a strong track record of delivery that spans the hospitality and living sectors across the UK.

Preet Ahluwalia, principal director at Dominus, said: “This deal represents a milestone for Fleet Street and the wider City of London.

“Our expert team has a robust track record for delivering exemplary schemes that create real value for local communities and economies – the site at 65 Fleet Street will be no different.

“By working with the existing building and with an ambitious design team, we will minimise our environmental impact and create a place that truly serves the city and its people.

“This is also a significant moment for Dominus, marking the commencement of us partnering with institutional capital to bring forward a development.

“Our strengthening collaboration with Cheyne Capital is testament to our experience, reliability and integrity.

“Meanwhile, we continue to be ambitious and pursue other joint ventures and opportunities, where we know we can add real value to communities and places.” 

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KSL and Luis Contreras acquire Sereno Hotels (IT)

Cheyne Capital (Cheyne) completed a cross-jurisdiction senior secured facility to a Joint Venture between KSL Capital Partners (KSL) and entrepreneur Luis Contreras. The loan, provided by funds managed and advised by Cheyne Capital, will be used to finance the acquisition of Sereno Hotels to support the expansion of the Sereno Hotels platform. Sereno Hotels develops, owns and operates the award-winning, ultra-luxury hotel Il Sereno on Lake Como, Italy, as well as its sister resort, Le Sereno, on the island of St Barthelemy, France.

Raphael Smadja, Head of France and Co-Head of Europe at Cheyne Real Estate stated: “We are pleased to expand our partnership with the KSL team and to support their strategy to develop high-end luxury leisure destinations, following our financing for Beaumier, the pan-European luxury boutique hotel group and another KSL portfolio company, successfully closing in 2022. Recent market performance confirms both the resilience and growth potential of the luxury hotel market in Europe and validates Cheyne’s investment thesis to finance well-funded hotels managed by a strong operator, located in prime leisure markets.” 

Antoine-Julien Richard, Loan Originator at Cheyne Real Estate, added: “This second pan-European facility, spanning France and Italy, using regulated lending vehicles, demonstrates Cheyne’s ability to provide flexible and innovative financing. We are delighted to complete our third loan in Italy, where we continue to identify compelling lending opportunities, particularly in the hospitality sector, and we look forward to continuing to increase our presence in the region.”  

Martin Edsinger, Partner at KSL, concludes: “We believe in the continued growing relevance of the seasonal leisure hospitality space in Europe. Both Sereno Hotels as well as Beaumier represent two best-in-class branded platforms that allow us to capitalize on accretive acquisitions and repositionings in the luxury and ultra-luxury space. Cheyne has been a great partner as a one-stop debt financing solution for our platforms to continue to capitalize on growth across Europe.”

KSL was advised by Hogan Lovells, Deloitte and Monassier as notaries in France.

Cheyne was advised by Allen & Overy Paris and Milan (Caroline Delavet and Fabio Gregoris) as legal counsels and Étude Lasaygues as notaries in France (Francois Gauthier, Alexandre Baikalov, Morgan Chaix, Laura Pompe).

Image source Pexels.

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Briefs: Radisson debuts in Casablanca; Azora acquires two hostels

RADISSON ARRIVES IN CASABLANCA: Radisson Hotel Group has launched its first Radisson-branded hotel in Morocco with the opening of Radisson Hotel Casablanca Gauthier La Citadelle. Located in Casablanca’s Gauthier district, this is Radisson Hotel Group’s second property in the Casablanca and the ninth hotel in the country. The upscale hotel is owned and operated by subsidiaries of Al Hoceinia Holding and features 133 rooms, including nine suites. The hotel includes a restaurant, rooftop bar and restaurant, a lobby bar, an outdoor pool, fitness center and 450 square meters of meeting and event spaces.

AZORA ACQUIRES TWO HOSTELS: Azora, the Madrid-based real estate investment manager, has completed the acquisition of two hostels in Dublin and Barcelona on behalf of its Azora European Hotel and Lodging Fund (AEHL) through a deal with a BlackRock-managed fund. The properties include the Jacobs Inn Dublin and the Jacobs Inn Barcelona, which are currently operated by Siggis Capital. The hostels were sold unencumbered and will be operated by Latroupe, the boutique hostel operator owned by AEHL. Since 2011, Azora has acquired more than 100 hotels and 26,000 hotel keys and has invested more than €3 billion in the hospitality sector.

KSL JV SECURES LOAN TO ACQUIRE SERENO HOTELS: Cheyne Capital, the alternative asset manager, has completed a cross-jurisdiction senior secured facility to a joint venture between KSL Capital Partners and entrepreneur Luis Contreras. Provided by funds managed and advised by Cheyne Capital, the loan will be utilized to finance the acquisition of Sereno Hotels and expand the Sereno Hotels platform. Sereno hotels develops, owns and operates the ultra-luxe hotel Il Sereno on Lake Como in Italy and its sister resort, Le Sereno, on the island of St. Barthelemy in France.

SHERATON SUITES IN ATLANTA COMPLETES RENOVATIONS: Sheraton Suites Galleria Atlanta has announced the completion of its $12 million renovation. Located near The Battery and Truist Park, the hotel has undergone extensive refurbishments, which include a complete transformation of the all-suite guestrooms and public areas. Renovations also include new carpeting, beds, bedding, furniture, artwork and upgraded bathrooms. The hotel’s lobby and restaurant have also been refreshed. The hotel features a fitness center, two swimming pools and 5,749 square feet of meeting space.

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ADIA ups private credit bets

Abu Dhabi Investment Authority (ADIA), the emirate’s $892bn sovereign wealth fund, is upping its private credit exposure with an increased commitment to alternative asset manager Cheyne Capital’s capital solutions strategy, a real estate private credit fund.

ADIA’s statement confirms that it is upping its commitment to the ninth vintage of Cheyne’s strategy to £650m ($831m).

In the statement, Mohamed Al Qubaisi, Executive Director of the real estate department at ADIA, said: “We have invested with Cheyne for a number of years and welcome the opportunity to grow our relationship.

“We see this as a compelling investment proposition in a market that is looking to private credit lenders for capital.”

The move is the latest sign of growing sovereign wealth funds interest in the $1.6tn private credit market and comes just months after Mubadala Investment Company said it would be an anchor investor in a new special situations fund set up by Starz Real Estate targeting refurbishment and redevelopment opportunities across Europe.

Earlier this week, Jada, a unit of Saudi Arabia’s PIF sovereign fund, announced a $53m investment into a fund raised by San Francisco-based Partners for Growth, its second private credit investment to date.

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Abu Dhabi wealth fund ADIA raises investment in Europe’s Cheyne Capital

Abu Dhabi’s sovereign wealth fund has increased its funding commitment to Cheyne Capital’s real estate private credit strategy in Europe.

The Abu Dhabi Investment Authority (ADIA) committed an undisclosed amount to Cheyne’s programme, dubbed as the capital solutions strategy, bringing the total commitment to £650 million ($836 million), European media reported on Tuesday.

The programme targets senior lending against real estate in Europe.

“The capital solutions strategy aims to meet the increasing demand for various forms of real estate credit by drawing on Cheyne’s expertise in the European real estate lending market,” a statement quoted Mohammed Al Qubaisi, Executive Director of ADIA’s real estate department.

“We see this as a compelling investment proposition in a market that is looking to private credit lenders for capital.”

ADIA has assets worth around $933 billion, according to the Sovereign Wealth Fund Institute (SWFI).

Cheyne Capital is a London-based alternative investment fund manager that invests in senior debt, equity of corporates and real estate.

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What's New In Investments, Funds? – Blackstone, S-Bank, Cheyne, Abu Dhabi

he latest news in investment offerings, financial products and other services relative to wealth advisors and their clients.

Blackstone US investments group Blackstone has partnered with Finland’s S-Bank to provide individual investors in Finland the opportunity to invest in private markets.

The combination will widen access to a private credit market in Europe which has traditionally been confined to institutional investors with high investment minimums and a requirement to lock up capital for long periods.

The move by Blackstone Private Wealth Solutions into what it sees as under-exploited European markets follows agreements with BNP Paribas earlier this year, and ING last year. (In those cases, Blackstone brought its European private credit investment platform to qualified private investors in France and the Netherlands, respectively.)

S-Bank's (aka S-Pankki) private credit fund invests in loans in unlisted companies, mainly in Europe. The S-Pankki European fund (S-Pankki ECRED) is a feeder fund whose target fund is Blackstone European Private Credit Fund SICAV. 

The target fund Blackstone European Private Credit Fund SICAV, which was launched in October 2022, had €581 million ($634 million) in January. The investments are secured senior loans.

(The fund is not intended for investors in the US.)

Cheyne Capital, Abu Dhabi Cheyne Capital has secured a commitment from a wholly-owned subsidiary of the Abu Dhabi Investment Authority for the ninth vintage of the Cheyne Real Estate Credit Holdings (CRECH) programme.

The programme, which is also known as the Capital Solutions strategy, will be added to earlier investments to bring ADIA’s subsidiary’s total commitment to the Capital Solutions strategy to £650 million ($830.8 million).

The strategy continues CRECH’s focus on senior lending against European real estate. In addition, it provides solutions across the capital structure, including subordinated debt, hybrid credit and commercial mortgage-backed securities.

CRECH’s recent deals include the structuring of a £780 million loan alongside JP Morgan to Quintain for the refinancing of Wembley Park, London. Other recent deals include a £318 million loan to Goldman Sachs-backed Riverstone for two later living developments in London, £229 million to Stanhope for the transformation and extension of the iconic 76 Southbank in London into a low-carbon office, €250 million to Bain Capital and Borio Mangiarotti to deliver 600 new homes in Milan and over €200 million to the Beaumier hotel group with lifestyle hotels across France, Switzerland and Spain.  

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ADIA boosts investment in private credit with fresh commitment to Cheyne Capital

Abu Dhabi Investment Authority will increase its commitment to Cheyne Capital's capital solutions fund to GBP 650 mn

Abu Dhabi Investment Authority (ADIA) will up its commitment to London-based alternative asset manager Cheyne Capital’s capital solutions strategy to GBP 650 mn (USD 831 mn), Bloomberg reports, citing a statement. The exact size of the new investment was not disclosed.

About the strategy: Cheyne’s capital solutions fund offers senior loans against European real estate, intending to transition Europe’s property market “away from increasingly obsolete assets supported by low interest rates,” says Ravi Stickney, managing partner and chief investment officer of Cheyne's real estate arm. The strategy also grants borrowers subordinated debt, hybrid credit, and commercial mortgage-backed securities.

What they said: “We have invested with Cheyne for a number of years and welcome the opportunity to grow our relationship. We see this as a compelling investment proposition in a market that is looking to private credit lenders for capital,” ADIA real estate department’s executive director, Mohamed Al Qubaisi, said.

ADIA ❤️ private credit: ADIA previously ventured into private credit in September, backing a USD 5 bn fund launched by Wells Fargo alongside asset manager Centerbridge and making a USD 932 mn investment in Australian real estate private credit company Qualitas Diversified Credit Investments.

And it’s not just ADIA: In February, sovereign wealth fund Mubadala agreed with Goldman Sachs to co-invest USD 1 bn in private credit in the Asia-Pacific region, with a particular focus on India. The wealth fund also took on the role of anchor investor for a private credit fund set up by Starz Real Estate and targeting European property in November 2023.

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ADIA backs $832m European real estate debt fund

Abu Dhabi Investment Authority (ADIA), the UAE’s largest sovereign wealth fund, will pump additional capital into Cheyne Capital’s European real estate debt fund, increasing the total investment to £650 million ($832 million).

The investment by a Gulf state-owned fund subsidiary marks the ninth round of the London-based Cheyne Real Estate Credit Holdings programme, called the Capital Solutions strategy, the hedge fund said.

No details on the size of the investment were given.

“We have invested with Cheyne for a number of years,” said Mohammed Al Qubaisi, executive director of ADIA’s real estate department. Al Qubaisi said he believed that it was a “compelling” investment proposition in a market that is looking to private credit lenders for capital.

Cheyne Real Estate invests across the real estate sector, including in student accommodation and affordable and senior housing projects.

Last August, an ADIA-owned unit said it would invest A$700 million ($449 million) into one of its Australian commercial real estate private credit fund.

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Abu Dhabi wealth fund ups Cheyne Capital commitment

Abu Dhabi’s sovereign wealth fund has increased its commitment to a European real estate credit strategy, run by Cheyne Capital.

The Abu Dhabi Investment Authority (ADIA), which is estimated to have around $892bn (£699bn) in assets under management, has increased its investment in Chayne’s capital solutions strategy to £650m.

Cheyne Real Estate Credit Holdings, which is now on its ninth vintage, focuses on senior lending in European real estate, providing subordinated debt, hybrid credit and commercial mortgage-backed securities.

Read more: Cheyne Capital looks to raise £7.5bn for property lending

Recent deals include the structuring of a £780m loan to Quintain for the refinancing of Wembley Park in London, alongside JP Morgan. The fund has also provided a £318m loan to Riverstone, backed by Goldman Sachs; and lent €250m to Bain Capital and Borio Mangiarotti for a housing development in Milan.

In total, the strategy provided loans worth more than £5bn in 2022 and 2023.

“The capital solutions strategy aims to help the European real estate industry transition away from increasingly obsolete assets supported by low interest rates and towards productive, sustainable assets for the long term. With an enormous pipeline of future investments requiring funding, we look forward to continuing to address this need as we open the strategy up to other investors in 2024,” said Ravi Stickney, managing partner and CIO of Cheyne Real Estate.

Mohamed Al Qubaisi, executive director of the real estate arm of ADIA, added: “The Capital Solutions strategy aims to meet the increasing demand for various forms of real estate credit by drawing on Cheyne’s expertise in the European real estate lending market.  We see this as a compelling investment proposition in a market that is looking to private credit lenders for capital.”

Based in London, Cheyne Capital has $11bn in assets, half of which is in real estate.

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Cheyne Capital wins investment from Abu Dhabi's ADIA for real estate debt fund

DUBAI, March 12 (Reuters) - Cheyne Capital has secured investment from a subsidiary of Abu Dhabi's biggest sovereign wealth fund for its European real estate debt fund, according to a joint statement on Tuesday, as appetite from Gulf state investors for private credit booms.

The London-based hedge fund said the investment, from the Abu Dhabi Investment Authority's unit, was for the ninth round of the Cheyne Real Estate Credit Holdings (CRECH) programme, also known as its Capital Solutions strategy, bringing ADIA's total commitment to 650 million pounds ($831.3 million).

The statement did not specify the size of the investment.

The Capital Solutions strategy is focused on senior lending against European real estate and includes subordinated debt, hybrid credit and commercial mortgage-backed securities (CMBS) services.

Cheyne has been an active lender in the residential real estate market, investing in student accommodation, affordable and senior housing projects.

A rise in global interest rates have hit commercial real estate valuations, creating a financing shortage for borrowers with maturing loans, as lenders require more capital to be injected before approving renewals of debt facilities.

The higher margins from these opportunities and have attracted money from Gulf sovereign investors.

ADIA, which manages the surpluses the Gulf emirate earns from oil exports, is the largest among the three sovereign wealth funds in Abu Dhabi besides Mubadala (MUDEV.UL) and ADQ.

It said last year its private equity division would position for growth in private markets including in private credit, while Mubadala last month struck a $1 billion deal with Goldman Sachs to go after private credit deals in Asia.

On Tuesday, the U.S. bank's unit Goldman Sachs Asset Management flagged it aims to expand its private credit portfolio to $300 billion in five years from the current $130 billion.

($1 = 0.7819 pounds)

Reporting by Federico Maccioni, editing Hadeel Al Sayegh and Louise Heavens

Our Standards: The Thomson Reuters Trust Principles.

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RECI Q3 Report: Market conditions drive increasing higher margin opportunities

Real Estate Credit Investments Limited (LON:RECI), a listed investment company paying a regular quarterly high dividend, has announced that the Investment Manager’s Q3 Investor Presentation is now available.

An extract from the Summary section of the presentation is set out for investors in the Appendix to this announcement.

Appendix: Q3 Investor Presentation Extract

Key Quarter Updates

•     Portfolio

‒    Total NAV Return for the quarter: -0.6% / Total NAV Return to Q3 2023 : +4.1%

‒    During the quarter, one UK loan fully repaid, realising net proceeds of £9.4m, and providing headroom to invest in new deals at enhanced IRRs

‒    Rotation of market bond portfolio into strong senior loans with attractive returns

•     Cash

–    Cash reserves remain targeted at between 5% to 10% of NAV

–    As at 31 December 2023, cash was £12.1m / 3.7% of NAV

•     Dividend

–    Dividends maintained at 3p per quarter, annualised 9.3% yield, based on share price as at 31 December 2023

–    Dividends predominantly covered by net interest income generated from RECI’s assets. The aim is for dividend cover to totally come from net interest income

•     Opportunities

–    The present macroeconomic backdrop is set to continue through 2024, resulting in further constraints in bank lending and alternative sources of capital. The opportunity to provide senior loans at low risk points, for higher margins, is increasingly evident

–    The Company expects to deploy its currently available cash resources to its near term commitments and towards a compelling emerging opportunity set in senior loans

•     Citywire Investment Trust Awards 2023

–    RECI won the Best Performance award for Specialist Debt at Citywire’s London-listed Investment Companies awards held on 01 November 2023. The performance awards are given to investment companies judged to have delivered the best underlying return in terms of growth in NAV in the three years to 31 August 2023.

Real Estate Credit Investments Limited (LON:RECI) is a closed-end investment company that specialises in European real estate credit markets. Their primary objective is to provide attractive and stable returns to their shareholders, mainly in the form of quarterly dividends, by exposing them to a diversified portfolio of real estate credit investments.

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Dominus and Cheyne Capital complete two senior loans for PBSA developments in the City of London

Dominus and Cheyne Capital have completed two senior loans totalling around £400m to provide development finance for two of Dominus’ PBSA developments in the City of London.

The first facility will support a development in Holborn, situated within close proximity of London universities including LSE, Kings College London and Queen Mary University of London.

Once the project is completed it will also provide a mix of cultural and affordable workspaces for creative businesses, leased free of charge by the Creative Land Trust, also included will be a viaduct connecting Holborn Viaduct and Snow Hill, as well as a free public access roof terrace.

The development will consist of 669 beds, with over 35% allocated as affordable accommodation and 64 rooms as wheelchair accessible.

A second loan will fund a development in the heart of the City of London, situated at 65 Crutched Friars between Aldgate and Tower Hill, which will consist of just under 800 beds, of which 35% will be affordable.

The space will also host the Migration Museum, a three-floor, 30,000 sq ft free to enter space.

The schemes, which have a combined GDV of circa £800m, will be developed and operated by Dominus.

Arron Taggart, head of UK investment at Cheyne Capital, commented: “We are pleased to be partnering with Dominus to deliver two developments in the heart of central London which will not only provide a first-class experience for students, but also stand to deliver benefits to the wider community.”

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Cheyne pumps £400m into City student beds

Dominus has secured two senior loans totalling £400m from Cheyne Capital Management to provide development finance for two purpose-built student accommodation developments in the City of London.