LEM Invests Preferred Equity in Los Angeles Apartment Property

LEM Capital LLC, a direct lender and investor in high-leverage mezzanine debt and preferred equity, has, through its fund affiliates, closed a $2.25 million preferred equity investment in a 251-unit apartment building located in the San Bernardino submarket of Los Angeles. The capital was used by the sponsor to acquire the property. Column Financial provided the first mortgage.

The transaction was completed in a very short-time frame. "Like many of our transactions, Ashford had a short fuse. We were able to underwrite and close this transaction in 17 days," said Jay Eisner, a principal in the Fund. The Fund specializes in fast moving situations and prides itself in taking an "entrepreneurial approach" to its business.

LEM, a $200 million fund, focuses on multifamily, office, retail and industrial properties nationwide, generally valued in the $10 million to $60 million range, and makes mezzanine investments of between $2 million and $10 million per property. LEM's investments can be structured in a variety of different ways including mezzanine loans, preferred equity and A/B notes. The Fund is managed by principals Ira Lubert, Jay Eisner and Herb Miller.

LEM also specializes in providing financing in transactions where there is existing first mortgage debt. The Company has worked with a number of different servicers and special servicers to develop structures that either comply with existing loan covenants or can be approved quickly. LEM also has relationships with many first mortgage lenders to provide additional proceeds behind new originations.

LEM is a member of Independence Capital Partners, a family of private investment management firms with approximately $2.0 billon of equity capital under management that specializes in real estate, private equity and venture capital transactions. LEM's objective is to make $75 million to $100 million of mezzanine and preferred equity investments per year.