Investment Vets Team Up To Launch Real Estate Hedge Fund

Apr 22 2010 | 1:01am ET

Andrew St Pierre and John Garofalo have teamed up to found a Boston-based asset management firm, which recently launched its first long/short hedge fund with $25 million in assets under management.

St Pierre, the former chief financial officer at Hammerman Capital, and Garofalo, previously with Wachovia's real estate corporate finance group, founded Merestone Partners as a joint-venture with The General Investment & Development Companies, a Boston real estate family office. The new firm will target investments in real estate-related securities across the capital structure.

The debut offering from Merestone is a long/short, multi-strategy hedge fund focused on the publicly traded side of real estate companies and corporations which are in industries that are directly impacted by trends in real estate or that have embedded real estate exposure.

"We feel that the capital markets-end of the real estate spectrum is an underserved one that traditionally was the realm of the long-only REIT manager. Merestone Partners is an attempt to provide more flexibility –both in recognizing the intrinsic real estate value that can occur in non-REIT companies and in maximizing opportunities by moving across the capital stack. The goal is to retain liquidity while still allowing for superior real returns," says St Pierre.

The fund charges a 1.5% management fee and a 20% performance fee. There is a $500,000 minimum investment requirement, and the fund has the capacity to manage $500 million.

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