Aimed at focusing on troubled investment assets in various American cities, investors Steve Witkoff and Michael Ashner again join their prowess to create a massive investment fund for troubled businesses, totaling $150 million.
The combined efforts between the two demonstrate significant that neither is a slouch in the investment market. Both boast notable investment activity, partnering up with others to commit almost $1 billion in another hotel project to be finished up at the New York’s infamous premier retail spot, 20 Times Square, as well as taking on the role of involved shareholders in New York REIT, acting as vanguards to begin liquidation of the distressed firm’s assets and appoint a new chief executive to oversee the process.
The major project 20 Times Square served as not only the foundation of a solid business investment between the Witkoff and Ashner, but also the ground for a budding friendship. “As we were working through 20 Times Square, which was a very complicated project, Michael and I became really close friends. I’m 60, and at this point in my career I want to work with people like Michael who are smart and great partners,” Witkoff said. Ashner commented “Steve has an expertise in development, which is a skill set I lacked.”
Catalyzed by their work together on the billion dollar project, the duo’s venture to save struggling establishment sprang into being, launching their massive investment fund. The idea itself has also piqued the interest of several other major investments with entities such as Sequoia, Soros Fund Management and Baupost also investing their money into the venture.
The fund itself enables investors to put up as much as $1.5 billion into the portfolio, enabling the fund itself to expand to new heights. With these big firms serving as the fund’s anchor investors, Witkoff and Ashner Ashner hopes that the added incentive they have will not only keep the anchor firms investments, but also utilize their expertise to maximize the potential for the fund. “The fund will retain at least a ten percent ownership interest in the acquisitions it makes, but it will give the anchor investors a chance to invest more in specific deals that they like.”
Both Witkoff and Ashner hope that their share significant investment experience together and significant personal stake, each investing $25 million into the new fund, will help enable the fund to reach out and target far and wide. The investment project various businesses in major American metropolitan areas, including New York city, that find themselves in financial straits.
Among these already include their first acquisition: a loan of $75 million dedicated to a mezzanine project at the DoubleTree Suites Hotel on 1568 Broadway, a deal they already managed to close on. With the past of the two, the success of closing the deal for the DoubleTree Suites mezzanine, the big name anchor investment firms, the two expressed great optimism for the future of their project going forward as partners. “I think we’re very complimentary,” Ashner said.
With the combined skill set of the two and the rapid success of the fund already, it’s only inevitable that many more profitable acquisitions for the firm will follow.