Mountain Real Estate Capital (MREC) closed its second joint venture equity investment in the last two months, along with a major REO purchase from an Atlanta bank. It is working with homebuilders to rejuvenate these distressed assets into new revenue streams. At the end of June, MREC acquired a Cedar Bay subdivision in north Jacksonville, Fla., to go with another set of properties called Heron’s Walk. The $4m investment venture with GreenPointe Communities in Florida, a residential real estate developer, includes 187 home sites with prices ranging from $175,000 to $275,000. Under the joint venture, MREC and GreenPointe plan to construct 78 homes at Cedar Bay and sell the remaining homes at Heron’s Walk to homebuilders. MREC is the investment affiliate of Mountain Real Estate Group, which has been around since 1993. But in the current environment, developers and builders are teaming up with MREC to identify and purchase distressed property. The parent group has organized up to $1bn to invest in these opportunities and has used $125m in 2010. The MREC team is led mostly by people moving from GMAC-ResCap’s Business Capital Group in 2009 to manage more than $1bn in property throughout the US. Earlier in June, MREC bought a portfolio of 56 residential communities in Atlanta from the Bank of North Georgia. The portfolio contained 700 home sites previously worth $51m. MREC also closed a $75m joint venture with GL Homes, a private homebuilder in Florida. The transaction, which closed in the middle of June, includes more than 8,300 acres of land and 6,500 home sites in West Palm Beach, Tampa, Naples and Fort Myers. The venture, according to MREC, will develop the lots and complete home sites over an 8- to 10-year period with sales estimated to reach $1.8bn. “We plan to aggressively expand our builder program by selecting one to two builders to partner with in each major submarket, and be there to support their business plan,” said Tom Mahathirath, senior investment manager with MREC. Peter Fioretti, CEO of MREC, said the latest investment with Greenpointe is another excellent opportunity for MREC. “We are excited to establish a relationship with an experienced developer and builder like GreenPointe, who will be our partner on more projects in the future,” Fioretti said. Ed Burr, CEO of Greenpointe, said teaming up with MREC will help his firm acquire a “broad range” of assets in the Southeast. “We believe that there will be many interesting opportunities over the next few years, and to team up with an aggressive and creative equity group like Mountain matches up well with our acquisitions and development strategy,” Burr said. Write to Jon Prior.