Angelo, Gordon uses its expertise in the ownership and management of commercial real estate to invest in the real estate debt markets.
We believe the real estate debt capital markets are inefficient, allowing a manager with the right platform and skill set to generate outsized returns. Pricing in the space tends to be driven by general statistical analyses, which often fail to reflect accurately the credit characteristics of real estate debt exposures. In addition to statistical analysis, Angelo, Gordon is able to perform fundamental analysis on the loans underlying the debt instruments, utilizing the firm’s significant expertise in owning properties and its extensive network of local operating partners.
The real estate debt group has focused primarily on commercial mortgage-backed securities that are mispriced relative to their true risk characteristics. We believe this area of the real estate debt market can be very inefficient and underappreciated by investors. We have the ability to invest throughout the debt capital structure,and will also invest in lower rated debt when we can earn appropriate returns. In addition, since early 2014 the group has engaged in whole loan origination.