Monarch, Davidson Kempner take over CA Ventures industrial platform

Backers of a private REIT who pumped $350 million into launching an industrial development vehicle spun out by Chicago-based CA Ventures are stepping into its direct management.

Big New York-based investment firms Davidson Kempner and Monarch Alternative Capital will be responsible for funding the staffing costs and future debt obligations of Centris, the development platform started by CA Ventures in late 2021, according to a source familiar with the deal. It was founded to land institutional money flowing into warehouse and industrial real estate development as the asset class gained favor.

CA Ventures ceded its involvement in Centris — led by Michael Podboy, who will continue to operate the Centris platform under Monarch and Davidson — after raising $350 million from the two investors, along with Long Pond Capital, to launch the venture. The three firms backing Centris could have increased those commitments up to $650 million, depending on potential development opportunities locked down by the private REIT, according to a previous report.

But further funding of Centris was choked off by rising interest rates starting in the spring of 2022, according to a person with knowledge of the company’s transition. Investment parameters were changed by partners in Centris, and additional capital for it never materialized. “CA Ventures was stuck with excessive staff burden and are happy that it’s now finally getting solved,” the person said.

Further details of the transaction weren’t immediately clear. Monarch didn’t return requests for comment and Davidson declined to comment. Podboy, who also led CA Ventures’ separate industrial arm, which started in 2018 before the Centris spinout, was unavailable to comment.

The developer’s original industrial development arm, called CA Industrial Properties, remained separate from Centris, and will keep pursuing opportunities throughout the U.S. and Europe with new leadership following Podboy’s transition to Centris. CA Industrial has developed more than $1.2 billion in total project costs, with more than 10.3 million square feet under development as of 2022.

Centris’ signature project since its inception has been the nearly 1.3 million-square-foot Generation Park logistics development in Houston, which started in 2022. It’s possible that Centris will be rebranded in coming weeks.

CA Ventures’ exit from Centris comes as the firm and its CEO Tom Scott are involved in several lawsuits as it tries to deleverage its balance sheet, including through asset sales.

Last year, CA Ventures — which specialized in student housing and standard multifamily before branching into other asset classes — also handed over control of a large student housing portfolio to its institutional partner in that space, Canadian investment manager QuadReal.

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