California teachers’ fund and Miami REIT launch $200M fund

Miami-based 3650 REIT just announced a partnership with the California State Teachers’ Retirement System to form a $200 million joint venture focusing on bridge and short-term real estate financing.

The new fund will provide loans for ground-up construction, recapitalizations, acquisitions and repositions in some U.S. markets where traditional capital is unavailable. After the initial $200 million commitment from the CalSTRS, the joint venture could receive a additional commitment of $300 million in the future, according to a press release.

CalSTRS is the largest retirement fund for teachers in the United States with a portfolio of more than $220 billion. About 13 percent of the total fund’s investments is allocated to real estate.

3650 REIT, launched in April, is a national portfolio lender led by real estate finance veterans Jonathan Roth, Toby Cobb and Justin Kennedy. Kennedy and Cobb were co-CEOs of LNR Property before resigning to found Grass River Properties following Starwood Property’s 2013 takeover of LNR. Roth previously worked as president of Canyon Partners Real Estate, and Cobb was previously co-head of U.S. commercial real estate lending for Deutsche Bank.

In addition to its Miami headquarters, 3650 REIT has offices in New York, Chicago, Los Angeles and Newport Beach. The company and its related companies own or manage over 2 million square feet of commercial real estate across the United States, according to the release.

Bridge lenders have become active in commercial real estate in South Florida and throughout the country in recent years as banks and other financial institutions are dialing back their construction lending.  — Keith Larsen