Cain enters Chicago via $117m development loan

The London-headquartered company has further expanded its reach in the US real estate debt market.

Cain International, the London-based private real estate equity and debt investor, has expanded its presence in the US property lending market by making its first loan in Chicago – a $117 million loan to finance LendLease and Aware Super’s co-development of a large multifamily tower in the city’s downtown area.

Affiliate title Real Estate Capital USA reported that the partners will use the loan to develop The Reed at Southbank, a 440-unit rental and condo building at 234 West Polk Street. The property is the second step in a larger redevelopment of the area and will include more than two acres of green space and views of Chicago’s skyline and famous lakes.

In addition to a strong conviction on the Chicago market, Cain was able to develop a solid working relationship with the developers and found that they all shared a common stance on urban living, Matthew Rosenfeld, head of US debt at Cain, told Real Estate Capital USA.

“Lendlease and Aware Super represent a world-class partnership with deep local roots, who share our conviction in the resiliency of urban living,” Rosenfeld explained. “We look at our borrowers as partners; we look for visionary developers and visionary investors in key markets. This project really is an urban regeneration project at its core, and [LendLease has] as good a track record as anyone doing that, so we’re very excited to be partnering with them.”

Lending strategy

Cain has originated more than $1 billion of loans in the US since launching its platform last year, Rosenfeld said. The company seeks out intricate loans that require real estate expertise, with Rosenfeld adding that Cain is not trying to just “bring sand to the beach”.

“What we focus on and what we think we’re quite good at is large, complex and flexible financings,” Rosenfeld said. “We’re not a commodity lender. We look for situations and instances that require some real thought. And hard work. And there [have] been plenty of those over the last 18 months.”

Cain has already originated loans in major metros such as New York, Miami and Los Angeles and was excited to move into Chicago. The market has a $700 billion GDP and is roughly the size of Poland or Switzerland, he added.

“When you think about what that $700 billion is really made out of [is] phenomenal universities. It’s an attraction to major global companies. You’ve got roughly 30 to 40 of the Fortune 500 businesses headquartered in Chicago. And so, you’ve got the infrastructure there to keep and maintain sustained prosperity and growth,” Rosenfeld said.

While Cain is very bullish on multifamily properties in major markets, the company is keeping its options open to opportunities.

“We are sector agnostic – we like all sectors. As long as it’s got a roof over it, and it is real estate, we’ll find a way,” Rosenfeld said.

This article first appeared in affiliate publication Real Estate Capital USA