Real Estate Services

Real Estate Debt

Overview

Washington Capital began managing real estate assets in the late 1980’s, when we first underwrote a private commercial mortgage for a pension trust client. That initial loan served as the basis for the launch of the Mortgage Income strategy3 in 1989. WaCap’s Mortgage Income strategy provides institutional investors with an alternative to traditional fixed income strategies. As a fixed income strategy, the Mortgage Income strategy seeks to provide superior risk-adjusted performance versus the broad fixed income market. The strategy seeks to provide stability attained through income generated by borrowers’ principal and income payments and by a disciplined approach to underwriting commercial mortgages.

The Mortgage Income strategy invests in private commercial construction, permanent, and combination construction/permanent loans for union-built projects across the United States. WaCap employs a core-plus approach by balancing the stability of permanent loans with the yield advantage offered by construction and construction/permanent loans. The strategy’s loans are generally secured through a first deed of trust and by employing conservative underwriting and collateralization practices. Investment guidelines allow for up to 10% of the Mortgage Income strategy to be invested in mezzanine loans.

Overview

Washington Capital began managing real estate assets in the late 1980’s, when we first underwrote a private commercial mortgage for a pension trust client. That initial loan served as the basis for the launch of the Mortgage Income strategy3 in 1989. WaCap’s Mortgage Income strategy provides institutional investors with an alternative to traditional fixed income strategies. As a fixed income strategy, the Mortgage Income strategy seeks to provide superior risk-adjusted performance versus the broad fixed income market. The strategy seeks to provide stability attained through income generated by borrowers’ principal and income payments and by a disciplined approach to underwriting commercial mortgages.

The Mortgage Income strategy invests in private commercial construction, permanent, and combination construction/permanent loans for union-built projects across the United States. WaCap employs a core-plus approach by balancing the stability of permanent loans with the yield advantage offered by construction and construction/permanent loans. The strategy’s loans are generally secured through a first deed of trust and by employing conservative underwriting and collateralization practices. Investment guidelines allow for up to 10% of the Mortgage Income strategy to be invested in mezzanine loans.

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Investment Process

Washington Capital’s real estate debt investment universe includes commercial properties located across the United States. Our investment approach seeks to add value in several ways: diligent underwriting, lending flexibility, portfolio diversification and market inefficiencies.

Underwriting

Through a diligent application of Washington Capital’s internal underwriting guidelines and an assessment of a borrower’s real estate experience and financial position, we seek to ensure that interest and principal payments are realized.

Flexibility

Washington Capital offers the added benefit of providing developers with combination construction/permanent loans. We also maintain flexibility within our underwriting discipline. We are periodically able to identify unique lending opportunities that may not fit the profile of a bank or other  lenders. In these cases, we are able to seek higher lending rates from borrowers with limited options for sourcing loans.

Market Inefficiencies

Our real estate debt portfolio holdings include properties within both urban and suburban markets. Through our exposure to suburban markets, we seek to take advantage of those inefficiencies inherent in markets with lower transaction volume and competition. We believe that this approach adds value relative to the index and our peers.

Underwriting

Through a diligent application of Washington Capital’s internal underwriting guidelines and an assessment of a borrower’s real estate experience and financial position, we seek to ensure that interest and principal payments are realized.

Flexibility

Washington Capital offers the added benefit of providing developers with combination construction/permanent loans. We also maintain flexibility within our underwriting discipline. We are periodically able to identify unique lending opportunities that may not fit the profile of a bank or other  lenders. In these cases, we are able to seek higher lending rates from borrowers with limited options for sourcing loans.

Market Inefficiencies

Our real estate debt portfolio holdings include properties within both urban and suburban markets. Through our exposure to suburban markets, we seek to take advantage of those inefficiencies inherent in markets with lower transaction volume and competition. We believe that this approach adds value relative to the index and our peers.

Getting Started

Prospective investors and real estate borrowers can contact Washington Capital by selecting the link below.

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