Birmingham Firm Tapped for Investment Advice
By Michael Tomberlin – The Birmingham News
A wealthy Louisiana family has hired Birmingham’s Founders Investment Banking to help it invest millions of dollars in commercial real estate.
The Dore family’s investment company, Dore Holdings LLC of Lake Charles, La., has never invested in commercial real estate, and Andy Sink, managing director of Founders’ real estate practice, thinks other investors will feel the same pull from the downtrodden sector.
“What you’re seeing now are the people who have capital are not traditional real estate investors,” Sink said.
Initially, Sink will help Dore find apartments and hotels to invest in because he believes that’s where the best opportunities are. Medical office properties also are on the list. Most of the properties will likely be in the South.
“When market went bad, hotels felt it first because their tenants leave every day and multi-family felt it second because their tenants leave every month,” Sink said. “Now, hotels have been among the first to see business start to come back and multi-family is starting to see it come back to an extent.”
For some commercial real estate sectors, where tenants have longer leases, Sink said the full extent of the troubles will not be known until leases expire and refinancings are due.
Ed Kleist, chief operating officer for Dore Holdings, said how much the Dore family ends up investing in real estate will depend on the opportunities that come available.
“Depending on how much it’s going to take, then we will take a hard look at it,” Kleist said.
Kleist said the Dore family, which made its money in Dore Energy and other public companies, has enjoyed success in other investment areas but has never explored commercial real estate as an option.
“As you keep on opening the paper and looking at the value of real estate, we’re saying ourselves, ‘Are we missing some opportunities?'” he said.
Kleist knew Sink from his own real estate deals and likes the way Founders takes detailed looks at commercial real estate opportunities. Sink said Founders has compiled an in-depth study on banks and their commercial real estate holdings, focusing on which sectors are recovering.
“We knew we had to be precise in our research and analysis beginning with determining what happened and how the sector reached this state of crisis,” he said. “Our team worked very hard studying the origins and impacts of the accelerating crisis in the commercial real estate sector.”
Kleist said he can envision Dore buying into a great variety of property types when the time is right.
“As they come available and as they make sense for us, we will look at retail, office and other investments,” he said. “We want to make sure we understand what we’re getting into and we’re not overstepping our expertise or our comfort zone.”
Sink said in addition to buying properties, Founders will help Dore and other investors purchase the debt on those properties from the banks.
Founders also handles mergers and acquisitions, corporate and strategic financing and other investment opportunities.
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