Cornerstone Acquisitions Form Global Real Estate Investment Firm
Hartford, Conn.-based Cornerstone Real Estate Advisers is expanding with the merger of Springfield, Mass.-based Babson Capital’s Real Estate Finance Group (REFG) and acquisition of London-based Protego Real Estate Investors. Cornerstone and Babson Capital are subsidiaries of mutual life insurance company MassMutual. Under the new arrangement, REFG will leave the Babson umbrella, integrate with Cornerstone and the Cornerstone Real Estate Advisors will become a subsidiary of Babson Capital Management. The transaction will be completed in Q110. "It’s very seamless from our standpoint. It’s a sister company, we’ve worked with these people for many years,” Cornerstone CEO David Reilly told HousingWire. “They’re on the debt side, we’re on the equity side. Combined operations will be extremely powerful relative to our ability to offer different products across the entire spectrum of real estate — debt, equity and securities — to our clients." REFG specializes in commercial mortgage lending and related products. REFG head Robert Little will continue to lead the debt business as chief investment officer of finance and as a senior member of Cornerstone’s management team. “One of the keys to this whole transaction is that it brings a powerful new platform for all of our clients. The existing clients of the three companies will have access a much broader range of products,” Little told HousingWire. “It’s business as usual, but in a much more integrated and powerful platform.” A separation transaction is the acquisition of Protego, a privately-held, UK-based real estate investment firm with $2.5bn of assets managed and serviced and offices in London, Rotterdam, and Stockholm. The firm focuses on office, retail, and industrial property investment opportunities. That deal is expected to close on January 1. “Protego has grown rapidly since its creation five years ago as demand for real estate investment expertise has grown among institutional and wealth management clients,” Protego CEO Iain Reid said in a statement. “Protego as a subsidiary of Cornerstone will be able to bring a wider and more integrated array of investment opportunities to our global clients as well as expand the Cornerstone platform to include the European marketplace.” The combined company will have a full service, global real estate investment organization with capabilities in public and private debt and equity, Cornerstone said, and will be one of the world’s largest real estate investment advisory firms in terms of assets. The firm will have offices in the North America, Europe and Asia with a combined staff of about 250 people and $30bn in managed and serviced assets. Write to Austin Kilgore.