Page 18 - RE-NJ

16 MARCH 2024
LOOKING AHEAD
With new $100 million rescue capital fund, Denholtz sees long-term value in solving short-term challenges
The need for so-called rescue capital for real estate projects was clear by the time that Denholtz Properties launched such a fund last fall.
Going public with its plan made it all the more obvious.
“We’ve seen the demand,” said Steven Denholtz, CEO of Red Bank- based Denholtz Properties, whose team fielded a flurry of calls after announcing the new fund.
“One of the things about the asset class is that
people in
trouble don’t
to see that or their partners to see it. They want to try to craft it as something a little bit different from that, so that’s the strategy.”
Discretion is key, the firm’s executives say, despite the size
of the undertaking. Denholtz is
now raising $100 million for the fund after its official launch in November, seeking to invest $5 million to $25 million per project
in the form of preferred equity or mezzanine debt, subordinate only to
first mortgage debt. It has already funded multifamily projects in New Jersey and North Carolina, with target geographies also including New York, Pennsylvania and other Southeast markets, as it looks to support fellow developers facing operating deficits, refinancing obstacles, unmet sale projections and other temporary capital challenges.
The 72-year-old firm, which has roots in multiple asset classes,
By Joshua Burd
want to tell
you they’re in
trouble. So they
don’t want to
go to the capital
markets and
have (brokers)
blasting out: ‘We need rescue capital.’ Nobody wants their lender
Steven Denholtz