Real-Estate Lender Plans Hedge Fund With 'Can't Miss' Strategy

Aug 1 2011 | 1:48pm ET

A Chicago-based real-estate lender says it has come up with a no-lose hedge fund strategy.

Clopton Capital is readying a hedge fund that will invest in what it calls the "fractured" commercial real-estate market. The new fund will lend to real estate deals with opportunities for big returns. Even if those deals result in default, however, the Clopton fund will both recover its initial investment and seize the property, Clopton said in a press release.

"The fund will be based solely on the investment criteria that any capital deployed will be secured two-to-one against income-producing commercial real-estate on a capitalization rate appropriate for the surrounding area," the firm said.

"For example, Clopton recently deployed capital for a rehabilitation loan located in the Chicago area," it said. "Despite contractor disputes and concerns, the loan was underwritten to then surrounding cap rate and the property, once stabilized in less than 90 days, was valued at a 50% value to contributed capital by Clopton exactly."

"This opportunity represented a 13% return for a 120-day investment of capital. Annually this represents a 39% return on capital, a previously unattainable number considering the low risk involved. The benefit of investing into Clopton alternative investments is that you receive a high return on capital and in the event of a default; you receive an even higher return."


In Depth

Will Liquid Alts’ Performance Sustain Future Asset Flows?

Aug 25 2014 | 10:34am ET

Liquid alternative investment funds saw the highest percentage of capital inflows...

Lifestyle

Och Funds Women In Finance Initiative At U-M

Aug 28 2014 | 3:01pm ET

Och-Ziff Capital founder Daniel Och and his wife have made a "generous donation"...

Guest Contributor

Looking Ahead: What’s In Store For Managed Futures?

Aug 22 2014 | 12:52pm ET

The last five years were phenomenal for investors in equity indices. Will the next...

 

Editor's Note

    Get A Sneak Peak Of The Alpha Pages

    Aug 25 2014 | 11:21am ET

    As many of you know, FINalternatives was recently acquired by the owners of Futures magazine, a firm called The Alpha Pages LLC. Today marks the soft-launch of a new sister site for both publications. As its name suggests, The Alpha Pages will cover all types of alternative investments, going far beyond the more well-known ones such as hedge funds and private equity. Read more…

 

Futures Magazine

July/August 2014 Cover

The time was right

Commodities/Futures magazine launched at the precipice of a revolution in the futures industry—really a revolution in the idea of risk management—that would move it from a small niche industry to ...

The Alpha Pages

TAP July/August 2014 Cover

The Alpha Pages Interview: Senator Rand Paul

Senator Paul sat down in the debut series of the Alpha Pages Interview to discuss the broken tax code, regulation surrounding Bitcoin, and his plans for the 2016 Presidential election.