Temasek, a global investment company headquartered in Singapore, and CenterSquare Investment Management, a real estate investment managed based in the United States, has on Monday announced the creation of a commercial real estate debt co-investment vehicle.

Once fully funded, the vehicle will have $200 million to deploy and will invest in high-quality subordinate real estate loans, CenterSquare said in a statement.

The first tranche of capital will invest alongside CenterSquare’s most recent debt fund in largely pre-identified deals.

As with other funds in the Debt Fund Series, it will continue to have a heavy focus on multifamily assets, while maintaining flexibility to respond to changing market conditions.

The portfolio is a continuation of the strategy employed across CenterSquare’s Debt Fund Series, which began in 1999 and seeks to generate risk-adjusted, equity-like returns through mezzanine loans and debt-like preferred equity investments, secured predominantly by highly viable, cash-flowing rental assets.

“In the current, higher-rate environment, we continue to see many borrowers in need of ‘gap capital’ as loans come due and they are no longer able to secure the same level of mortgage loan proceeds that were available previously in the lower-rate climate,

“We believe this creates an excellent opportunity for disciplined investors to earn attractive all-in returns, and we’re excited to expand our relationship with the highly respected Temasek investment team,” said Michael Boxer, Managing Director of CenterSquare’s Private Real Estate Debt vertical.

Richard Gorsky, Managing Director, Private Real Estate Debt added that now is one of the best times he has seen in his career to invest in commercial real estate debt.

According to him, the convergence of several factors, including the reconstitution of the borrower’s capital stack and resetting valuations, combined with the favorable fundamentals across residential subsectors underpin this timely co-investment opportunity.

“We are excited to continue our partnership with Temasek, which began in early 2022, and has grown steadily since that time,

“It is a pleasure working with like-minded, pragmatic capital partners, who have allowed us to continue providing creative solutions for our borrowers,” he added.

Founded in 1987, CenterSquare Investment Management is an independent, employee-owned real asset manager focused on listed real estate, private equity real estate and private real estate debt.

The firm is headquartered in suburban Philadelphia, with offices in New York, Los Angeles, London and Singapore.

With more than $14 billion in assets under management (December 2024), the firm manages investments on behalf of some of the world’s institutional and private investors.

#RealEstateInvestment #PrivateEquity #Temasek #CommercialRealEstate